NAHR AL-BARED, Lebanon - A Lebanese soldier and at least eight Fatah al-Islam extremists have been killed in a surge of fighting at a Palestinian refugee camp in northern Lebanon, the army said on Thursday.

The soldier was hit Thursday by sniper fire outside the Nahr al-Bared refugee camp where militiamen of the Al-Qaeda inspired group Fatah al-Islam are holed up, a spokesman said.

The Islamist fighters were killed on Wednesday when the two sides fought fierce battles that also left three soldiers wounded, he added.

"Between eight and 10 Fatah al-Islam elements were killed yesterday (Wednesday) when the army responded with direct hits to fire which was targeting its positions," the spokesman said.

Officials from the Islamist group, which has been besieged by the army at the Nahr al-Bared refugee camp since its fighters launched attacks on military targets on May 20, could not be reached for confirmation.

"The situation around Nahr al-Bared is very unstable, as the extremists keep firing on the army which responds very forcefully," the army spokesman said.

The soldier's death brought to 80, including 35 soldiers, the number of people confirmed killed since fighting started on May 20.

The Beirut government, pushing for a peaceful end to the standoff, has insisted the group hand over fighters to stand trial over attacks against its armed forces during the bloodiest internal fighting since the 1975-1990 civil war.

But Fatah al-Islam is adamant that none of its fighters will be surrendered.

"The situation is still complicated and requires more discussions in order to close the gap between the points of views of the two sides," Sheikh Mohamad Al-Hajj, a member of a delegation of clerics attempting to mediate for a peaceful solution, told AFP.

More than two thirds of Nahr al-Bared's 31,000 residents have been displaced by the fighting, as relief agencies struggle to deliver aid to the displaced and residents still trapped inside.

Lebanon on Wednesday announced that 20 Fatah al-Islam members involved in the fighting have been arrested and face terrorism charges before a military tribunal.

The group is made up of 18 Lebanese nationals and two Syrians, according to a judicial source, who added that crimes of terrorism carry a possible death sentence. -AFP