JUBA: Heavy fighting was raging Thursday in South Sudan's key oil-producing north, officials said, although neighbors Kenya and Ethiopia said they had made "good progress" in efforts to broker an end to the civil war.
Army spokesman Philip Aguer said troops loyal to President Salva Kiir were battling forces allied to former vice president Riek Machar inside the town of Malakal, capital of Upper Nile state.
He also said troops were preparing an offensive against Bentiu, the main town in oil-rich Unity State, to follow on from their recapture of Bor, another state capital that had fallen into rebel hands during the nearly two weeks of clashes in the world' youngest nation.
"There is fighting in Malakal. Our forces are in the northern part of Malakal and the rebels are on the southern part. We will flush them out of Malakal," Sudan People's Liberation Army (SPLA) spokesman Aguer told AFP.
"The rebels are still controlling Bentiu but SPLA is planning to retake Bentiu soon," he added.
The violence in South Sudan, a fledgling oil producer which won independence from Sudan just two years ago, has left thousands dead, according to the United Nations.
Ten of thousands of civilians have also sought protection at UN bases amid a wave of ethnic violence pitting members of Kiir's Dinka tribe against Machar's Nuer.
The UN Security Council voted Tuesday to send nearly 6,000 extra soldiers and police to South Sudan, nearly doubling the UNMISS force to 12,500 troops and 1,323 civilian police.
Amid reports of bodies piled in mass graves and witness testimonies of massacres and summary executions and rapes, UN Secretary General Ban Ki-moon has promised those responsible would be "held accountable".
Crude prices have also edged higher because of the fighting as oil production, which accounts for more than 95 percent of South Sudan's fledgling economy, dented by the violence and oil workers evacuated.
Kenyan President Uhuru Kenyatta and Ethiopia's Prime Minister Hailemariam Desalegn flew into Juba on Thursday for talks with President Kiir, the latest in a line of peace brokers who have flown in since the fighting began on December 15.
Ethiopian Foreign Minister Tedros Adhanom Ghebreyesus said "good progress" was made in the talks, with further talks of the Inter-Governmental Authority on Development(IGAD) -- a regional grouping -- scheduled to take place in Nairobi on Friday.
He said among the issues discussed was the possible release of the 11 senior figures close to Machar who were arrested in the wake of the outbreak of violence.
"The release of the detainees is part of what we discussed. The release of the detainees could be part of the solution," he said.
The fighting started after Kiir accused Machar of attempting a coup. Machar denied this, and said the president was exploiting a clash between members of the army as a pretext to carry out a purge.
Although Kiir and Machar -- a former vice president who was sacked in July -- have said they are open to peace talks, fighting has spread to half of the country's 10 states.
The battles have also been intense: an AFP correspondent who visited the recaptured town of Bor on Wednesday said bodies littered the streets and stores were looted.
The UN said aid agencies need $166 million (121 million euros) over the next three months to distribute food, manage camps for the displaced and provide health and sanitation.
"There are at least 90,000 people who have been displaced in the past 10 days. This includes 58,000 people who are sheltering in UN peacekeeping bases," said the UN humanitarian chief in the country, Toby Lanzer.
UN rights chief Navi Pillay said a mass grave had been found in rebel-held Bentiu and cited reports of at least two more in Juba, the capital. Around 15 bodies were found in one site in Bentiu, and another 20 bodies at a nearby river, she said.
The UN mission in Juba was more cautious, confirming 15 killed but saying it was still "investigating reports of such atrocities".
In a Christmas message, Kiir acknowledged that there were "people who are targeting others because of their tribal affiliation," but sought to distance himself from the ethnic violence, saying: ""It will only lead to one thing, and that is to turn this new nation into chaos."
Nearly 100 US troops are on the ground in South Sudan, and the US military has deployed a "platoon-sized" Marine contingent to neighbouring Uganda. Four US troops were wounded on Saturday when their aircraft was shot at during an evacuation operation.
The United States was instrumental in South Sudan's independence from the north.