UPDATE 5-Iran, UN nuclear agency to resume talks in Dec

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* U.S. said Iran fired at its drone; escalation risk clear

* EU, US urge Iran to resolve "outstanding issues"

By Fredrik Dahl

VIENNA, Nov 9 (Reuters) - Iran will return to talks with the U.N. nuclear agency next month, both sides said on Friday, the latest push to seek a peaceful end to a dispute that has raised fears of a new Middle East war.

The news came days after U.S. President Barack Obama's re-election, which some analysts say may give fresh impetus to efforts to end a decade-old standoff with a country the West accuses of working towards a nuclear weapons capability.

In a reminder of how tensions could escalate, the Pentagon said on Thursday that Iranian warplanes had fired at a U.S. drone in international airspace last week and Iran said it had chased off an "unidentified" aircraft that had crossed its borders.

The International Atomic Energy Agency (IAEA) said it hoped the talks in Tehran on Dec.

"said Iran fired at its drone; escalation risk clear* EU, US urge Iran to resolve "outstanding issues"By Fredrik DahlVIENNA, Nov 9 (Reuters) - Iran will return to talks with the U.N"13 would produce an agreement to allow it to resume a long-stalled investigation into possible military aspects of Iran's nuclear programme.

The agency says it has "credible information indicating that Iran had carried out activities relevant to the development of a nuclear explosive device" and wants Tehran to give it access to sites, officials and documents to clarify the issue.

Iran denies it wants nuclear bombs and has repeatedly ruled out stopping its atomic activities.

A series of meetings since early this year, the last one in August, failed to make concrete progress.

Israel, assumed to be the Middle East's only nuclear-armed power, has threatened military action if it looks like Tehran is close to getting nuclear weapons capability.

Washington gave the news of the new talks a cautious welcome.

"We will see how this round goes. In the past Iran has been unwilling to do what it needs to do despite the best efforts of the IAEA. But we commend the IAEA for keeping at it and we call on Iran to do what it needs to do to meet the international community's concerns," State Department spokeswoman Victoria Nuland told a news briefing.

A Western diplomat was also sceptical, noting that the talks would only take place after the next meeting of the IAEA's 35-nation governing board.

"So it is the usual scenario: defer criticism now by promising something later. Something that has failed to materialise the last four times," the envoy said.

INITIAL STEP?

The IAEA's talks with Iran are separate from Tehran's nuclear discussions with six world powers - the United States, Russia, China, Britain, France and Germany - which resumed in April but have also so far failed to reach any breakthrough.

European Union foreign policy chief Catherine Ashton - who represents the powers in talks with Iran - sees the new IAEA-Iran meeting as long overdue.

It "could be an initial step on the path to resolve outstanding issues," Maja Kocijancic, Ashton's spokeswoman, said, adding that Iran had so far failed to cooperate in substance.

She reiterated concerns about the Parchin military site, which the IAEA wants to visit as part of its inquiry and where Western diplomats suspect Iran is now trying to clean up any evidence of past illicit nuclear-related activity.

The IAEA mission is likely to be headed by Deputy Director General Herman Nackaerts, the chief U.N. nuclear inspector, diplomatic sources said.

Iran's ambassador to the IAEA, Ali Asghar Soltanieh, later confirmed to Reuters that his country would hold talks with the U.N.

agency next month.

Years of talks and sanctions have failed to end the dispute.

But, now assured of a second term, Obama, who has so far resisted calls in the United States and Israel for an attack on Iran, appears free to pursue a diplomatic settlement while threatening yet heavier sanctions if Tehran does not bend.

The United States and its allies want Iran to curb its uranium enrichment programme. Iran, one of the world's largest oil producers, says the West must first lift the increasingly harsh sanctions.

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