A new nuclear reactor being built by North Korea at its Yongbyon complex could be used to produce weapons-grade plutonium, a leading US research institute says.

The Institute for Science and International Security (ISIS) Thursday released satellite images showing construction of an experimental light water reactor (LWR) at the complex.

The images taken by satellite imagery firm DigitalGlobe support observations by two US experts who recently visited Yongbyon and were told about work on the new reactor.

Yongbyon for decades has been at the heart of the North's drive for nuclear weapons, with a now-ageing gas graphite reactor producing enough plutonium for possibly six to eight bombs.

That reactor was shut down as part of a six-nation disarmament accord, although the North vowed to restart it after quitting the six-party talks.

The new LWR reactor is being built near the site of a cooling tower, which the North blew up in 2008 in front of international TV crews to dramatise its commitment to denuclearisation.

While making weapons-grade plutonium is harder to do from large-scale LWRs, ISIS said this would be possible using the small 25-30 megawatt reactor now being built.

"If North Korea wanted to produce weapon-grade plutonium, it could do so by under-irradiating the LEU (low enriched uranium) fuel," ISIS founder and president David Albright told AFP by email.

"It would need to enrich more LEU to do so, but it could do so if it wanted."

ISIS, in a report, estimated that the new LWR would need several tonnes of low enriched uranium in the core and about one tonne of LEU in addition per year to keep the reactor running.

"These values could vary depending on the design of the reactor and whether it will be optimised for electricity production or weapon-grade plutonium production for weapons," the report said.

The research institute estimated that the North would need a pilot-scale uranium enrichment plant with about 1,000 centrifuges to produce the required amount of LEU per year.

North Korea said in September last year that it had reached the final stage of enriching uranium -- a second way of making nuclear bombs on top of its plutonium-based programme.

Separate satellite images released recently show work under way at the site where the North staged its second atomic weapons test in May 2009.

South Korea said it was closely monitoring developments but had no evidence yet that another test was being planned.

The North quit the six-party talks a month before its second nuclear test. In recent months it has expressed conditional willingness to return to the forum, grouping the two Koreas, dialogue host China, the United States, Russia and Japan.

But US President Barack Obama warned last week in Seoul that the North must show "seriousness of purpose" on scrapping its atomic programmes before the talks can resume.