UPDATE 1-North Korea's nuclear test ready "soon" - source
* North "has readied third nuclear device test"
* Test could come "soon", source says
* Source predicted first test in 2006 (Adds detail, background)
BEIJING, April 24 (Reuters) - North Korea has almost completed preparations for a third nuclear test and has the capacity to carry it out "soon," a senior source with close ties to Pyongyang and Beijing told Reuters.
"Soon. Preparations are almost complete," the source said when asked whether North Korea was planning to undertake a nuclear test.
North Korea said last week it was ready to retaliate in the face of international condemnation over this month's failed rocket launch, increasing the likelihood the hermit state will push ahead with a third nuclear test in defiance of U.N. sanctions.
The source has correctly predicted events in the past, telling Reuters about North Korea's first nuclear test in 2006 days before it took place.
This is the first time an official with knowledge of Pyongyang's intentions has confirmed the test is set to happen.
South Korean newspapers have quoted officials in Seoul as saying the test could take place as early as in two weeks.
The source did not specify whether the test would be a third test using plutonium or whether Pyongyang would use highly enriched uranium.
Many analysts expect that North Korea will for the first time try a nuclear device using highly enriched uranium, something it was long suspected of developing but which it only publicly admitted to about two years ago.
Defence experts say that by successfully enriching uranium, to make bombs of the type dropped on Hiroshima nearly 70 years ago, the North would be able to significantly build it up stocks of weapons-grade nuclear material.
It would also allow it more easily to manufacture a nuclear warhead to mount on a long-range missile.
"North Korea may consider abandoning (the test) if the United States agrees to a peace treaty," the source said, reiterating a long-standing demand by Pyongyang for recognition by Washington and a treaty to end the 1950-1953 Korean War, which ended in a truce. (Reporting by Benjamin Kang Lim; Writing by David Chance; Editing by Nick Macfie)