NAHR AL-BARED, Lebanon - Lebanese troops edged closer toward the last positions held by Islamists besieged in a Palestinian refugee camp with the battles concentrated near a key underground shelter.

Army helicopters launched repeated strikes on the Fatah al-Islam fighters, an AFP correspondant witnessed, as an army spokesman expressed confidence that the soldiers were gaining ground.

"Every day the soldiers are getting closer to the positions held by the Islamists," the spokesman, who did not wish to be identified, said.

An army officer at Nahr al-Bared told AFP that troops were engaged in battles near the so-called "Abu Ammar" underground shelter, which bears the nom de guerre of the late Palestinian leader Yasser Arafat.

A well-informed Palestinian source said Abu Ammar was one of the most fortified shelters in the camp.

The army officer said the Al-Qaeda-inspired militants had abandoned the shelter and were now hiding in nearby buildings from where they were firing at troops.

"The soldiers are firing back but they have yet to inspect the shelter for fear of mines left behind by the Islamists," he said.

The camp, which is located near the northern coastal city of Tripoli, was set up following the creation of Israel in 1948 and has numerous underground shelters that were built to withstand Israeli air strikes.

The shelters have served as a hiding place for the Fatah al-Islam fighters since their standoff with the army began on May 20.

Most of Nahr al-Bared 31,000 residents fled at the start of the battles but some 60 militants are still inside and have refused repeated appeals to surrender and face a fair trial.

More than 200 people have died in the fighting, including 153 soldiers. -AFP