North Korea is operating a secret underground plant to make nuclear bombs from highly enriched uranium (HEU) despite denying that such a programme exists, a South Korean newspaper said Wednesday.

Dong-A Ilbo, quoting an unnamed senior government source, said South Korea and the United States have shared intelligence on the plant in Yongbyon district.

Seoul's National Intelligence Service refused comment on the report.

"Despite North Korea's denial that uranium enrichment programmes exist, South Korea and the United States have shared information that North Korea has built an uranium enrichment plant which is in operation," the source told Dong-A.

Dong-A said both countries believe the facility can produce HEU for nuclear bombs. It said the plant is located at Sowi-ri in Yongbyon, North Pyongan Province, where the North's plutonium-based nuclear complex is situated.

The source was quoted as declining to give further details such as the technological level and the output of highly enriched uranium.

The North in 1994 signed a deal with the United States to shut down its admitted plutonium-producing reactor complex at Yongbyon in return for various incentives.

Washington's claims in 2002 of a secret HEU programme torpedoed the 1994 deal and sparked a new nuclear crisis. Pyongyang rejected the US allegations and restarted its reactor in protest.

A fresh round of nuclear disarmament talks began in 2003, involving both Koreas, the US, China, Japan and Russia. The talks focused on more pressing concerns about the plutonium programme, which fuelled a 2006 atomic bomb test.

Yongbyon has been shut down in return for energy aid as part of a 2007 pact. But talks on the next stage -- full denuclearisation in return for diplomatic ties with Washington and a formal peace pact -- are stalled by disputes over verifying the North's acknowledged nuclear activities.

US Secretary of State Hillary Clinton, who visits Seoul on Thursday and Friday, told a Senate confirmation hearing last month Washington is still concerned about the HEU programme.

"Our goal is to end the North Korean nuclear programme -- both the plutonium reprocessing programme and the highly enriched uranium programme, which there is reason to believe exists, although never quite verified," she said.