South Korea plans to announce a new deal with the United States aimed at extending the range of its ballistic missiles to cover the whole of North Korea, a report said Saturday.

Yonhap news agency quoted a senior government official as saying the two allies were fine-tuning the agreement.

"We are considering making an announcement as early as tomorrow or early next week," the unidentified official reportedly said. The report could not be independently confirmed.

The official declined to discuss details but a diplomatic source told Yonhap the agreement would more than double the range of Seoul's ballistic missiles to 800 kilometres (500 miles), from the current limit of 300 km.

It would mean the whole of North Korea would be within reach but the missiles' maximum payload would reportedly stay at 500 kilograms (1,100 pounds).

The existing deal with Washington, which allows Seoul limited access to US missile technology, is up for renewal at the end of the year.

All of South Korea is within striking distance of North Korean missiles and President Lee Myung-Bak said in March that Seoul needed a "realistic adjustment" of its missile capabilities.

The poverty-stricken but nuclear-armed North attempted but failed to launch a satellite into orbit in April this year, sparking international condemnation over what was seen as a disguised long-range missile test.

The two Koreas have remained technically at war since the 1950-53 Korean War ended with an armistice rather than a peace treaty.