South Korea (search) said Wednesday it believes North Korea (search) has taken a key step toward making nuclear weapons even as the North's envoys pledged reconciliation in talks in Seoul.

South Korea's National Intelligence Service, or NIS, said the communist North had reprocessed a small number of 8,000 spent nuclear fuel rods that were stored at its nuclear facilities at Yongbyon (search).

Reprocessing all the rods could yield enough plutonium for several atomic bombs within months, adding to a suspected arsenal of one or two nuclear bombs, experts say.

Since April, North Korea has claimed that it had all but finished reprocessing the rods. Until now, both U.S. and South Korean officials have expressed doubt about the North Korean claim, but the statement from the South Korean intelligence agency is likely to heighten tension over the North's suspected development of atomic bombs.

"We believe that North Korea has reprocessed a small portion of the 8,000 spent rods," the NIS said in a report to the National Assembly. South Korea receives much of its intelligence on North Korea from the United States, which spies on the North with satellites and surveillance aircraft.

Ko Young-koo, NIS director, also said North Korea conducted nuclear-related tests of high explosives at Yongduk-dong, a site west of the Yongbyon nuclear complex. But it was unclear whether the tests were recent. South Korea has been aware of similar tests over the past decade.

Arriving in Seoul, a high-level North Korean delegation said Wednesday it was willing to work for reconciliation with South Korea despite the approach of "the black clouds of a nuclear war."

The trademark North Korean rhetoric came on the first of four days of talks in Seoul between Cabinet-level delegations. The meetings are to promote inter-Korean projects, but South Korean officials plan to press North Korea to agree to multilateral talks on nuclear development.

"Our nation faces a stark situation as the black clouds of a nuclear war are coming toward the Korean Peninsula minute by minute," the North Koreans said in a reference to the nuclear dispute.

"No one can fathom the calamitous consequences if the crisis situation crosses the critical point and ignites a war," they said in a statement. "Neither the North nor the South would be free from them."

North Korea has used harsh rhetoric for decades, and U.S. and South Korean officials believe it's a tactic designed to escalate tension and pressure negotiating partners into making concessions.

In an apparent reference to the U.S.-led victory in the Iraq war, the statement said "the aggressive forces are getting more frantic with war fevers as a result of a war in a different region."

At the same time, the North Korean delegates said they arrived "with the sacred willingness for national reconciliation, peace and reunification."

South Korean President Roh Moo-hyun is visiting China to try to enlist Beijing's help in peacefully resolving the nuclear standoff. China, which has leverage over North Korea because it is a major source of food and fuel for its destitute neighbor, has said it wants a Korean Peninsula free of nuclear weapons.

North Korea "has to choose the path of peace and coexistence with others," Roh said in Beijing on Wednesday. "No nation in the international community believes that the nuclear project will assure its future."

Tensions flared last October when U.S. officials said Pyongyang admitted having's a secret nuclear program, in violation of international agreements.

North Korea says it's willing to resolve U.S. security concerns if Washington provides security guarantees. The North is also desperate for economic aid.