Vienna: The head of the UN watchdog chided Iran on Thursday for exceeding for the second time an agreed upper limit for nuclear material set out in last year's atomic accord.


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A report by the International Atomic Energy Agency last week showed that Iran's stock of so-called heavy water had inched above the 130-tonne level set out in the landmark deal.


Heavy water, a modified form of normal water, is used in certain types of nuclear reactor. Plutonium for use in nuclear weapons can be extracted from fuel rods used in heavy water reactors.


"Iran has since made preparations to transfer a quantity of heavy water out of the country," which will bring it below the ceiling, IAEA chief Yukiya Amano told the agency's board.


"It is important that such situations should be avoided in future in order to maintain international confidence in the implementation" of the deal, he said in Vienna.


The July 2015 nuclear deal between Iran and six major powers states that Iran's "needs" are 130 metric tonnes of heavy water and that any excess must be "made available for export".


The confidential IAEA report, seen by AFP, said that Iran exceeded this level --- for the second time -- by 100 kilos but that Iran had undertaken to ship abroad five tonnes.


Reza Najafi, Iran's envoy to the IAEA, said today that Iran was "making the preparations" for doing so, telling reporters that the amount to be sold abroad may even exceed five tonnes.


He also questioned whether the 130-tonne level was a strict limit.


US ambassador Laura Holgate urged Iran to complete the process of exporting the extra material "without delay".


"Nothing short of full implementation will assure the international community that Iran continues to uphold its commitments," Holgate told the IAEA board of governors meeting.


"Simply notifying states that this heavy water is for sale without removing it from Iran does not fulfil" Iran's commitments under the deal, Holgate added.


US State Department spokesman Mark Toner said last week that it was "important to note that Iran made no effort to hide this" and that he was "not sure whether that constitutes a formal violation".


Otherwise the IAEA's quarterly report, the fourth since the nuclear deal entered into force in January 2016, confirmed that Iran continues to abide by the deal.