Tehran, May 14 (Reuters): Iran today said it would reject any demand to stop what it calls peaceful nuclear work, a day before European foreign ministers discuss incentives and penalties designed to rein in Tehran’s atomic ambitions.

European Union foreign ministers will meet tomorrow to work out technical, trade and political sweeteners that would be offered to Iran in exchange for allaying western fears it is seeking to produce an atom bomb, notably by halting uranium enrichment.

Iran, the world’s fourth largest oil exporter, insists its nuclear plans are purely to make electricity and says it will not give up enrichment, a process which can used to make fuel for power stations but also material for weapons.

“Any proposal that obliges us to stop peaceful (nuclear) activities would not have value and would not be valid,” Iranian President Mahmoud Ahmadinejad said. He accused the Europeans of living in a “colonialist world” and said Tehran would not accept decisions reached in Brussels.

“If they want to decide things that concern us in a place where we are not present, then that body does not have any legal validity or credibility in decision-making,” Ahmadinejad said.

Washington and its European allies have been seeking to pass a UN Security Council resolution that would oblige Iran to halt all uranium enrichment work or face possible sanctions.

But Russia and China, which have energy interests in Iran, have resisted the move. Washington agreed to let Britain, France and Germany devise a package of benefits for Iran in return for cooperating, putting back a decision on a possible resolution.

“The aim is to come up with a very attractive package to make it difficult for the Iranian government to refuse,” said a senior envoy from one of the so-called “EU3” countries.

A draft statement for tomorrow’s EU meeting stated the bloc was ready to help Tehran develop “a safe, sustainable and proliferation-proof civilian nuclear programme” while insisting it halt all enrichment on its soil.

EU officials said it was undecided if help could include letting western firms build nuclear power stations in Iran, an offer sources said was in an earlier package rejected by Iran last August and which also stipulated an end to enrichment.

The EU wants the package ready by a meeting on Friday in London of the five permanent Security Council members plus Germany.