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Iran has substantially lowered the death toll in the earthquake that devastated the south-eastern city of Bam last year, cutting the fatalities by more than a third.

The head of the State Statistics Centre Abbas Ali Zaali said that 26,271 people died in the quake of magnitude 6.6 that flattened most of the city on December 26, state radio reported.

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The ancient, pre-Islamic Arg-i-Bam or Citadel of Bam, founded more than 2,000 years ago and a United Nations world heritage site made of mud bricks, clay and straw, was flattened.

"The historic quarter of Bam has been completely destroyed and many of our countrymen are underneath the ruins," said Mohammad Ali Karimi, the governor of Kerman province, where Bam, 600 miles south-east of Teheran, is located on the edge of the Lut desert.

A powerful earthquake struck southeastern Iran on December 26, 2003, killing over 43,000 people, injured 20,000, left 60,000 homeless and destroyed much of the city of Bam.

The USGS National Earthquake information center is reported a magnitude of 6.6 for the quake, which was located just southwest of the city.

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