Increased activity has been spotted near the site of North Korea's 2006 nuclear test but it is unclear whether the hardline communist country is preparing for a second test, a report said Wednesday.

Smoke was spotted recently at various places around the site in the country's northeast, a South Korean government source was quoted by Yonhap news agency as saying.

"We are closely watching to determine whether North Korea is working to repair the nuclear site," the source said, adding the smoke is believed to have come from the burning of clothes and equipment used during the repair work.

Other sources quoted by Yonhap said the North may be simulating activity to pressure the United States amid a deadlocked nuclear disarmament deal. They said the North is believed to have finished repairing the site after its first test on October 9, 2006.

South Korea's intelligence agency said it could not confirm the activity at the site at Punggye-ri in Gilju country of North Hamkyong province.

The report came as US nuclear envoy Christopher Hill arrived in the North to try to salvage the crumbling disarmament deal.

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