Iran has already produced 17 kilograms of enriched uranium, the nation's atomic chief Ali-Akbar Salehi said Wednesday.
Iran started the 20-per-cent enrichment process in February to produce fuel for the Tehran medical reactor, DPA reported.
Salehi told ISNA news agency that Iran could produce 5 kilograms of enriched uranium per month.
He said Iran would be able to produce fuel rods for the Tehran reactor by March 2011, and afterwards start construction of a new, more powerful, medical reactor to replace it.
Tehran initially planned to swap its 3.5-per-cent enriched uranium with Russia and France in exchange for higher grade fuel.
But the deal initiated by the International Atomic Energy Agency in October is stalled, despite mediation by Brazil and Turkey last month and an agreement to store Iran's low-enriched uranium in Turkey until the swap.
The West fears Iran is secretly pursuing a nuclear weapons programme, a charge Tehran denies, and enriching uranium to 20 per cent is a significant threshold towards the capability to produce weapons-grade uranium.
According to a long-term plan, 10 new enrichment sites are to be built in the coming years, including two in the year 2010-2011.
Locations for five have already been found, and spots for the remaining five were to be earmarked shortly.