SEOUL, the Republic of Korea - The Democratic People's Republic of Korea(DPRK) will probably carry out a third atomic test next year and prospects for bilateral talks with the Republic of Korea(ROK) are slim, a research report from a ROK foreign ministry institute said on Friday.

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The regular report was published a day after Pyongyang vowed a nuclear "sacred war" and the ROK held a major military drill near the border.

The DPRK, which carried out nuclear tests in 2006 and  2009 has yet to show it has a deliverable weapon as part of its plutonium arms programme, but a third test would raise  tensions further on the divided peninsula and rattle global  markets.

"There is a possibility for DPRK carrying out its third nuclear test to seek improvement in its nuclear weapons  production capability, keep the military tension high and promote Kim Jong-un's status as the next leader," the report said, referring to Kim Jong-il's youngest son, Pyongyang's  heir apparent.

"Tension between the two countries will remain high with chances of additional DPRK attacks on ROK staying high. Chances of a summit meeting between leaders of the two sides look slim," the institute said, according to a summary of the report.

The analysis for 2011 was written by the Institute of  Foreign Affairs and National Security, which is run by the  Foreign Ministry.

Analysts say the DPRK's tactic of demonstrating what progress it has made towards developing a nuclear weapon is a ploy aimed at restarting talks between itself, the ROK,  China, Japan, Russia and the United States, from which it hopes to wring concessions.

"Some form of meeting between six-party members could be held during 2011 to discuss DPRK's uranium enrichment, but chances are very low for any meaningful progress being  achieved," the institute said.