VIENNA - As U.S., British and U.N. experts were busy disarming Libya, a shipment of nuclear bomb-related machinery from Turkey slipped past Western intelligence agencies into Libya in March, an atomic expert said on Saturday.

Libya, which swiftly disclosed the shipment, has also denied purchasing nuclear materials from North Korea, casting doubt on news reports Pyongyang secretly provided Tripoli with uranium, diplomats close to the United Nations said.

David Albright, a former U.N. weapons inspector and president of a U.S.-based security think-tank, told Reuters this was a shining example of the "failure of export controls" that enabled the creation of an illicit nuclear market.

In a report issued on Friday and obtained by Reuters, the International Atomic Energy Agency (IAEA) said:

"One shipment of (centrifuge) components actually arrived in Libya in March 2004, having escaped the attention of the (Western) state authorities that had seized the cargo ship BBC China in October 2003."

"These components that arrived in March were assembled in Turkey and sent to Libya via Dubai," the atomic energy expert, who is familiar with the IAEA investigation and its new Libya report, told Reuters.

There was no suggestion that Libya, which has been cooperating with U.N. inspectors, tried to hide the shipment. The IAEA said: "Libya notified the agency of the arrival of this container and it has since been shipped out of the country."

The work of dismantling Tripoli's atom bomb program by U.S. and British experts in Libya was underway in March. But the experts missed the shipment's arrival, diplomats said.

A diplomat from an IAEA board member country said there may be more such orders made before Libya renounced its nuclear, chemical and biological weapons programs in December that have yet to reach Tripoli.

U.S. and British intelligence officials arranged the seizure in Italy of the BBC China while carrying centrifuge components made in Malaysia to Libya via Dubai in the United Arab Emirates.

Turkey was first named as a player in a nuclear black market linked to the father of Pakistan's nuclear weapons program, Abdul Qadeer Khan, in a Malaysian police report based on testimony of Buhary Syed Abu Tahir, a Sri Lankan businessman.

There were two Turkish men named in the police report. One had worked for the German engineering firm Siemens .

Malaysian authorities said on Friday they had arrested Tahir. Washington said this was a key step in shutting down Khan's network which stretched from Europe to Africa and across the Middle East to Asia.

NO TRADE WITH NORTH KOREA

Separately, Western diplomats close to the IAEA said Libya denied purchasing 1.6 tonnes of uranium hexafluoride (UF6) from North Korea, which would have indicated the communist state was selling nuclear material directly to states hungry for a bomb.

UF6, a solid at room temperature, becomes a gas when heated and can then be fed into gas centrifuges that enrich uranium for use as fuel for atomic power plants or in weapons.

"Libya has denied buying anything directly from North Korea," one of the diplomats told Reuters.

News reports about Libya's alleged direct trade with North Korea said the IAEA had "strong evidence" for this claim based on interviews with members of Khan's black market.

But diplomats said the IAEA has no strong evidence, only second-hand testimony of persons interviewed by Pakistani authorities given to the U.N. by Pakistan. The IAEA is taking this information seriously but has no way of confirming it.

The diplomats said that the Libyans have generally been cooperative and are considered trustworthy.

But these diplomats and the atomic expert said that even if North Korea did not sell it directly to Libya, this did not mean the uranium did not originate in North Korea.

They said it was possible the Pakistanis acted as middlemen, buying the uranium from Pyongyang and reselling it to Libya.

The Malaysian police report, released in February, said the UF6 "was sent by air from Pakistan to Libya."

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