According to the Institute for Science and International Security (ISIS), Iran began work on the Arak heavy-water reactor, located in central Iran, in the 1990s. It was not acknowledged by Iran, however, until its existence was revealed in 2002 by the Iranian opposition group Mojahedin-e Khalq (MEK, a.k.a. MKO), based on data widely believed to have been supplied by Israel.
The disclosure – along with the that of an unknown underground centrifuge facility at Natanz – spurred speculation that Iran's nuclear program was not purely for civilian purposes, as Tehran claims. Following the disclosure, the US accused Iran of pursuing nuclear weapons in 2004.
The United Nations ordered Iran to halt work on heavy-water projects, including the construction of the reactor, citing Iran’s “lack of cooperation” with IAEA. The latest IAEA report states that the Arak reactor is scheduled to begin operation at the end of 2013.
Iran has not given IAEA inspectors access to the Arak reactor, despite requests, nor access to water from the reactor in order to take samples. Inspectors have instead had to rely on less effective satellite imagery.