NAHR AL-BARED, Lebanon (Reuters) -A Lebanese soldier was killed on Tuesday at a Palestinian refugee camp in north Lebanon where fighting between troops and Islamist militants is in its fifth week, security sources said.

They said another Lebanese soldier died on Tuesday from wounds sustained earlier.

Witnesses said army shelling resumed early in the morning of al Qaeda-inspired militants entrenched in the Nahr al-Bared camp and later intensified on the camp’s eastern side. Television footage showed smoke billowing from punctured buildings.

On Monday, sources said the army seemed close to its goal of crushing Fatah al-Islam’s positions on the camp’s edges and had destroyed a main position it had used as a weapons store and training centre.

Security sources said soldiers discovered bodies of seven militants in a building where they were checking for booby traps.

The fighting is Lebanon’s worst internal violence since the 1975-1990 civil war. At least 162 people, including 73 soldiers, more than 57 militants and 32 civilians, have been killed.

The army says the militants triggered the conflict by attacking its positions near the camp and outside the nearby city of Tripoli. Fatah al-Islam says it acted in self defense.

The army has slowly encroached on the area controlled by the militants, without entering the camp’s official boundaries. Security forces are barred from going into Lebanon’s 12 Palestinian refugee camps under a 1969 Arab agreement.

A Palestinian political source said a group of Palestinian mediators had met with Shahin Shahin, a key Fatah al-Islam member, on Monday to discuss details of a truce.

The plan entails an agreement to cease fire after which the militants would retreat to the camp’s official boundaries.

A 150-strong force of mainstream Palestinian factions would then deploy in the camp and Fatah al-Islam would announce its disbandment.

“We spoke to Shahin Shahin yesterday and he was positive,” the source said, adding that mediators were now waiting for the army to respond to the plan.

Lebanese authorities have repeatedly demanded the militants surrender, but Fatah al-Islam has vowed to fight to the death.

Fatah al-Islam emerged late last year after splitting from the pro-Syrian Palestinian faction Fatah al-Intifada (Uprising).

Lebanon’s Western-backed government says Fatah al-Islam is linked to Syrian intelligence, a charge denied by Damascus.