Coming Soon: Deal With North Korea ... or 2nd Nuclear Test?

Officials see signs of upcoming nuclear test -- but also signs of nuke deal.

Oct. 9, 2008 — -- Amid indications the United States is on the verge of a major agreement with North Korea that would take the Asian nation off a list of state sponsors of terror, U.S. intelligence has picked up signs that North Korea may be preparing for another nuclear test, sources say.

Satellite imagery over the past two weeks has picked up suspicious activity at a suspected nuclear test site, senior U.S. officials told ABC News. The activity includes tunneling and the movement of large cables -- the same type of activity detected before North Korea's nuclear test in October 2006.

U.S. officials are unsure whether North Korea would actually test another bomb or whether this is simply saber rattling -- or perhaps proton rattling -- designed to put pressure on the U.S. to cave in on the nuclear talks.

"They know we look at this stuff," said one senior official. "It is quite possible they are just screwing with us."

Another senior official said the moves are likely a "negotiating tactic ... they do want to do a deal."

And there are indications the United States and North Korea might be closer to a major deal.

Christopher Hill, the lead U.S. negotiator, returned from North Korea on Sunday, senior officials told ABC News, with an offer from North Korea on the issue that has deadlocked the talks: verification.

North Korea has already agreed to dismantle its nuclear program; but negotiators haven't been able to agree on how that would be verified. The United States has demanded wide access to North Korea's military installations, which North Korea has rejected.

The details of this latest offer are a tightly guarded secret. As of early today, only a handful of top officials had been briefed on the offer, including Secretary of State Condoleezza Rice, National Security Advisor Stephen Hadley and President Bush.

If there is to be a deal, it would come under extremely odd circumstances.

In addition to the signs of a possible nuclear test, today the International Atomic Energy Agency (IAEA) announced that North Korea had blocked its inspectors from its Yongbyon nuclear facility, the only nuclear facility that North Korea had allowed access to.

Additionally, North Korea has conducted missile tests this week and appears to be preparing to do more.

But perhaps in a sign that something is afoot, today Rice was asked about the North Korea's move to block IAEA inspectors and said only this: "Well, let's just wait and see over the next several days. We're reviewing the situation and I'm talking to my colleagues. And when we have an announcement, we'll have an announcement."