Senior Abu Sayyaf leader Juhaiber Alamsirul was among the rebels killed in the fighting in the countryside near the town of Sumisip.

Military sources also said five soldiers and an undetermined number of the estimated 30 rebels were wounded during the fighting in which troops overran the camp housing at least 50 people.

"The fighting was fierce and two of my soldiers were killed and five more are wounded and all have been evacuated to military hospital in Zamboanga," Brig. Gen. Nicanor Dolojan, commander of military forces in Basilan, said.

The military said it recovered bandoleers, police uniforms, three cell phones, hand-held radio transceivers and ammunition for M14 rifles.

Basilan, the largest and most northern of the Sulu Archipelago, lies between the Philippine island of Mindanao and Borneo. Mindanao is another of the country's areas where mainly Islamic militant groups are seeking independence or at least more autonomy.

Last week troops killed another senior Abu Sayyaf leader, Suhud Tanadjalin, in a raid at his hideout in Basilan's Tuburan town.

The latest military successes come as the government sits down in Kuala Lumpur, Malaysia, for peace talks with one of the Philippine's oldest rebel groups, the Moro Islamic Liberation Front.

The MILF, considered one of the main Islamic militant groups, came into existence in 1981 when a group split in 1981 from the Moro National Liberation Front which has been fighting for an independent Muslim homeland for around 40 years.

Some of the fiercest fighting between government troops and security forces has taken place between the MILF and Abu Sayyaf group.

In July 2007, 14 marines died -- 10 by beheading -- in fighting on Basilan Island. It remains unknown which group was responsible for the beheadings.

The face-to-face talks in Malaysia are the first by a special peace panel constituted by President Benigno Aquino since he won the national election in June and fulfils one of his key platform pledges -- to kick-start stalled negotiations with several militant groups.

During his inauguration, Aquino challenged rebel groups to call a cease-fire and sit down for peace talks.

"Are you prepared to put forth concrete solutions rather than pure criticism and finger-pointing? If it is peace you truly desire, then we are ready to call for an immediate cease-fire. Let us go back to the table and begin talking again," Aquino said.

In December, the government also made conciliatory gestures toward the Communist Party which acts as an umbrella organization several disaffected militant groups. More than 40 alleged insurgents were released from custody, lending hope to the restarting of talks, on hold since 2004, with the CP.

Formal discussions could go ahead early this year, likely in Norway, the Communist Party said, noting that the release was "a boost of goodwill for the forthcoming resumption of peace negotiations."

The detainees were arrested in February last year when they attended a health workshop in the coastal town Morong, east of Manila. Some were accused of being insurgents and others faced charges of helping rebels.

But the group, known as the Morong 43, claimed that the military had planted bomb-making materials and weapons on them and abused them while there were detained. They also said its members were denied access to lawyers and were held in isolation at a military camp.

earlier related report
Long-awaited Philippine communist talks to start
Manila (AFP) Feb 13, 2011 - The Philippine government and communist rebels will begin peace talks in Norway this week, but analysts say recent deadly clashes show there is no chance of a quick end to the decades-long insurgency.

After a breakthrough last month in which the two sides agreed to negotiate for the first time in six years, President Benigno Aquino's administration voiced hope that the conflict would be over by 2014.

"Our most optimistic projection is that... substantive agreements can be reached in 18 months' time and peace achievable in three years," chief government negotiator Alexander Padilla said on Friday before flying to Oslo.

But less than a week after the foes agreed to meet, communist rebels killed five policemen in a well-planned ambush in a northern Philippine town.

The assault marked the start of an offensive across the country that the military said left at least 14 people dead ahead of the week-long talks that will begin in Oslo on Tuesday.

"Certainly, it is a sign of bad faith on their part," military spokesman Brigadier General Jose Mabanta told AFP when asked about the communists' intentions in carrying out the assaults.

The Communist Party of the Philippines and its armed wing, the New People's Army (NPA), launched their uprising in 1969, and tens of thousands of people have been killed during the conflict, according to military estimates.

About 5,000 NPA rebels are continuing the fight, mainly in the poorest areas of the Philippines, earning funds primarily through extortion from businesses and provincial politicians.

While their goal of seizing control of the country through an armed revolution remains as elusive as ever, their recent offensive shows they remain a formidable threat in the countryside.

Since 1986, successive Philippine administrations have held peace talks with the communists through their Netherlands-based political arm, the National Democratic Front (NDF), but all the negotiations have proved fruitless.

The last talks, under then-president Gloria Arroyo, were held in 2004. They fell apart after the NDF demanded that the government have the group removed from US and EU lists of "terrorist" organisations.

Pointing to a reason for optimism about the upcoming negotiations, Padilla said no conditions had been set by either side.

But the founder of the communist insurgency, Jose Maria Sison, said in a statement from his self-imposed exile in Utrecht that the terror list issue remained a priority.

"The NDF continues to demand that the (government) withdraw its treasonous acts of having requested the US, EU and other foreign governments to put the CPP, NPA and myself in the so-called terrorist lists," Sison said.

Echoing the views of other analysts Rodolfo Mendoza, a retired colonel, said the communists intended to use the talks only to get "political mileage" and they had little intention of ever signing a peace.

"They will prolong it. They will talk but there will be no immediate agreement. It will not prosper," said Mendoza, who did intelligence work against the rebels when he was in the military and is now a security analyst.

He and other analysts said the differences between the two sides remained too great, with the communists determined to overhaul the country's economic model and railing against endemic corruption by the nation's elite.

"The bottom line here is there remain very intractable issues," said Pete Troilo, Manila-based business intelligence director with Pacific Strategies and Assessments, a security research group.

"There are very hardline factions within the NDF that will never agree to peace unless the Philippine government gives substantial concessions and that is never going to happen."

And while Padilla said the government was hoping to secure a peace by 2014, it was not prepared to accommodate hardline communist positions.

"If the agenda stalls, if they put in unsolvable demands then we will stop talking," he told AFP.

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