(Adds quotes from South Korean foreign minister, paragraphs 22-23)
* Seoul seeks high-level talks with North in late March
* Talks between Sweden and North Korea extended
* U.S., S.Korea express cautious optimism, urge "concrete action"
* U.S., S.Korea may hold summit between N.Korea summits
* Report shows activity at North Korean reactor
SEOUL/WASHINGTON, March 16 (Reuters) - South Korea said on Friday it was seeking high-level talks this month with North Korea to prepare for a summit and that South Korean President Moon Jae-in may meet Donald Trump before the U.S. president's planned meeting with the North Korean leader.
Amid a flurry of diplomacy from Asia to Europe to Washington, Trump reaffirmed his plan to meet with North Korea's Kim Jong Un by the end of May during a phone call on Friday with Moon and both voiced "cautious optimism" about efforts to resolve the crisis over North Korea's nuclear weapons.
A White House statement said Trump and Moon discussed preparations for their upcoming engagements with Pyongyang and agreed that "concrete actions," not words, were the key to denuclearization of the Korean peninsula.
They "emphasized that a brighter future is available for North Korea, if it chooses the correct path," it said.
Earlier, Moon's chief of staff, Im Jong-seok, said proposed North-South talks in late March would cover key agenda topics and other details of the pending summit between Moon and Kim.
If North Korea agrees to the talks, they would offer an opportunity for Pyongyang to break its silence on what Seoul says is Kim's desire to meet Trump and Moon and his willingness to freeze his country's nuclear and missile programs.
"We've decided to narrow down the agenda topics to denuclearising the Korean peninsula, securing permanent peace to ease military tension and new, bold ways to take inter-Korean relations forward," Im, the head of South Korea's summit preparation team, told reporters.
Im said Moon may meet Trump after an inter-Korean summit but before Trump's planned summit with Kim in May.
South Korea's Yonhap news agency said Moon pledged in the call with Trump to cooperate closely with Washington on summit diplomacy. Trump asked South Korean officials to show flexibility in trade negotiations with the United States in the call, the South Korean presidency said.
Even amid North Korea tensions, Trump has repeatedly denounced a U.S. free trade deal with ally South Korea as "unfair" and threatened many times to scrap it.
Senior South Korean officials met Kim Jong Un in Pyongyang this month and told Washington the North Korean leader was open to giving up his nuclear weapons if North Korea's security was guaranteed.
Trump responded with a surprise announcement that he was willing to meet Kim in a bid to resolve the crisis over North Korea's development of nuclear missiles capable of hitting the United States.
TALKS IN SWEDEN
North Korea's state media has yet to comment on the content of Kim's meeting with the South Koreans, but North Korean Foreign Minister Ri Yong Ho arrived in Sweden this week for talks with his Swedish counterpart Margot Wallstrom, prompting speculation he could lay the groundwork for a Trump-Kim summit.
Wallstrom's press secretary Pezhman Fivrin said the talks, which had been due to end late on Friday, would continue on Saturday. He declined to give further information.
Swedish Prime Minister Stefan Lofven told a joint news conference with German Chancellor Angela Merkel in Berlin on Friday that Sweden, whose embassy represents U.S. interests in Pyongyang, was ready to act as a facilitator to help resolve tensions.
South Korea's Foreign Minister Kang Kyung-wha was in Washington on Friday for talks on North Korea and trade, as was Japanese Foreign Minister Taro Kono, who met U.S. Deputy Secretary of State John Sullivan in the morning.
The U.S. State Department said the two sides called the announcement of a meeting between Trump and Kim a "historic opportunity," while stressing that the U.S.-led campaign to press North Korea to give up its nuclear weapons through sanctions must continue until Pyongyang "takes credible, verifiable, and concrete steps toward denuclearization."
Kang held talks later on Friday with Sullivan, who is standing in after Trump fired Rex Tillerson as U.S. secretary of state this week. It was not known whether the two Asian ministers would meet CIA Director Mike Pompeo, who Trump has tapped to replace Tillerson.
Kang told PBS NewsHour she was "cautiously optimistic" denuclearization talks would happen between the United States and North Korea and that these would lead to "a breakthrough for a peaceful resolution of the North Korean nuclear issue."
She stressed though that full denuclearization would "take a long while because the (North Korean nuclear) program is very advanced."
The Japanese and South Korean ministers were expected to meet in Washington on Saturday.
In a phone call with South Korean President Moon on Friday, Japanese Prime Minister Shinzo Abe expressed a wish for talks with North Korea following Pyongyang's planned summits with South Korea and the United States, South Korea's presidential spokesman, Kim Eui-kyeom said.
On Thursday, the head of the U.S. Pacific Command, Admiral Harry Harris, cautioned the United States could not be overly optimistic about the outcome of any summit between Trump and Kim and must go into it with "eyes wide open."
A report on Friday by intelligence analysts at Jane's by IHS Markit said satellite imagery from Feb. 25 showed gas emissions at the North's experimental light water reactor, suggesting preliminary testing had likely begun.
The reactor could be used to produce weapons-grade plutonium, but North Korea is believed to already have enough fissile material for multiple nuclear bombs, according to Joshua Pollack, a senior research associate at the Middlebury Institute of International Studies at Monterey.
An official at South Korea's defense ministry said authorities were aware of the Jane's report, which follows a similar one on the 38 North website this month that said a nearby reactor had also continued to show signs of operation.
The U.S. State Department declined to comment on the Jane's report, calling it an intelligence issue. (Reporting by Christine Kim and Josh Smith in Seoul, Lesley Wroughton, David Brunnstrom and Steve Holland in Washington and Simon Johnson in Stockholm; Writing by David Brunnstrom Editing by Mary Milliken and James Dalgleish)