The United Nations and the Iraqi government have signed a deal to relocate 3,400 Iranian dissidents living in a camp in northeastern Iraq while their refugee status is determined.

In a statement Sunday, the U.N. Assistance Mission for Iraq said the agreement establishes a process to move the residents of Camp Ashraf to a temporary location. It did not give a timeline for their move.

U.S. Secretary of State Hillary Clinton said the residents will be moved to Camp Liberty, the former U.S. military base near the Baghdad International Airport. She welcomed the arrangement, saying it represents “significant progress on this issue.”

The U.N. High Commissioner for Refugees will monitor the relocation effort and deploy a team to Camp Liberty to process the refugees' claims before considering possible resettlement for them in third countries.

Iraqi Prime Minister Nouri al-Maliki last week extended a year-end deadline to close Camp Ashraf, which his government considers an affront to Iraq's sovereignty.

Also Sunday, the Iraqi military said two mortars hit the camp, located in barren terrain 65 kilometers northeast of the capital, Baghdad. No casualties were reported.

The People's Mujahedeen Organization of Iran first moved to Camp Ashraf during the time of former Iraqi President Saddam Hussein. When he was overthrown in the U.S.-led invasion of 2003, the camp came under American military protection. U.S. forces handed over security responsibilities for the site to Baghdad in January 2009.

The camp has been back in the spotlight since a controversial April raid by Iraqi security forces left at least 34 people dead and scores injured.

PMOI is committed to the overthrow of the Iranian government and sided with Iraq in its war against Iran in the 1980s. The group carried out a series of bombings and assassinations against Iran's clerical regime during that period but says it renounced violence in 2001.

The U.S. and Iran both officially consider the organization to be a terrorist group.