The Democratic People's Republic of Korea (DPRK) is restoring facilities at its Yongbyon nuclear reactor, the source of weapons-grade plutonium in the past, the Republic of Korea (ROK)'s defence ministry said on Tuesday.

"The DPRK is restoring nuclear facilities and continuing maintenance activities at Yongbyon," a spokesman quoted Defense Minister Kim Tae-young as telling parliament on Monday. "It is engaged in new construction and large-scale excavation."

The ROK foreign ministry said that Seoul is closely monitoring the work.

"There are some activities going on but we have no information on what these are for," said spokesman Kim Young-sun. "The government is watching closely the activities there and exchanging information with other countries."

An unidentified government official was quoted by Dong-A Ilbo newspaper as saying that two rectangular buildings were being built next to the site of a cooling tower demolished in 2008.

The Institute for Science and International Security (ISIS) said tracks made by heavy machinery along with construction or excavation equipment were visible in satellite photos.

ISIS said there appeared to be ongoing construction of two small buildings next to the former tower, which the DPRK blew up in June 2008 in front of foreign media to demonstrate its commitment to nuclear disarmament.

Kim also said the ROK will launch a full-scale propaganda war against the DPRK in response to any fresh cross-border provocation.

Kim on Monday had warned of possible provocations by the DPRK as it puts a leadership succession plan in place and in the run-up to the G20 summit in Seoul in November.

The ROK's military printed hundreds of thousands of leaflets and installed loudspeakers in border areas as part of reprisals following the sinking of a warship in March.

Kim told parliament preparations were under way to float the leaflets and small radios by balloon across the tense and heavily fortified border.

His ministry would also consider installing electric message boards and more loudspeakers.

Private ROK activists already float leaflets across the frontier, a practice which enrages the DPRK. The ROK's government says it has no legal power to ban it.

At military talks last week, the DPRK said its artillery was preparing to fire on the ROK sites used to launch the private leaflets unless Seoul halted the practice.

The talks - the first for two years - ended without progress after Seoul demanded an apology from Pyongyang for the warship sinking.

After months of tension, the DPRK has made some apparent conciliatory gestures to the ROK in recent weeks.

The DPRK has indicated willingness in principle to return to the Six-Party Talks chaired by China. But it says it wants separate talks with the United States about signing a permanent peace treaty on the peninsula.

Some analysts see an attempt to ease tensions and restart economic assistance during the succession process.

After a year-long gap, the two sides have agreed to resume reunions for families separated by war 60 years ago.

The ROK and the DPRK on Tuesday exchanged lists of 200 families who are seeking the brief meetings starting on Oct 30.

Seoul's Red Cross narrowed down the list from an initial 500 through a draw after confirming they were fit enough to travel to the DPRK's Mount Kumgang resort.