The UN Security Council will order sanctions against North Korea's space agency in a resolution to be passed this week condemning the state's ballistic launch, a diplomat said.

The resolution, which also targets other government entities and individuals linked to North Korea's nuclear weapons program, could be passed by the council as early as Wednesday.

Under a compromise between China and the US, the new sanctions designations are expected to be added to existing measures imposed after North Korea staged nuclear weapons tests in 2006 and 2009.

"The resolution condemns the launch and reiterates the Security Council's previous demands that North Korea abandon its nuclear weapons program and not proceed with further launches," the diplomatic source said, speaking on condition of anonymity because the measure has not yet been made public.

It "imposes new sanctions on North Korean companies, and government agencies, including North Korea's space agency responsible for the launch, and several individuals," the source added on Monday.

North Korea has denied accusations by the UN and the international powers that the rocket was a ballistic test. Pyongyang said it was launching an observation satellite.

The proposed resolution updates lists of nuclear and ballistic missile technology banned for transfer to and from North Korea.

It includes "new provisions targeting North Korea's illicit procurement efforts, in particular its smuggling of sensitive items that could contribute to the prohibited programs," the diplomat said, declining to provide further details.

"The US circulated the draft text today after getting agreement from China. The vote could be held Wednesday," a council diplomat told AFP.

Russian UN Ambassador Vitaly Churkin voiced Moscow's backing for the draft text last week.

AFP - Reuters