Lebanese Army soldiers on armoured personnel carriers (APCs) and military vehicles gather in Labwe, before heading towards the Sunni Muslim border town of Arsal, in eastern Bekaa Valley August 7, 2014. REUTERS/Hassan Abdallah

By Oliver Holmes

OUTSKIRTS OF ARSAL Lebanon (Reuters) - Militant Islamists withdrew from a Lebanese border town they seized at the weekend, ending five days of deadly fighting but taking with them captured Lebanese soldiers as hostages, militant and security sources said on Thursday.

Muslim clerics who had been mediating an end to the conflict in Arsal said they would negotiate for the release of remaining captives held by Sunni militants whose incursion marked the most serious spillover of Syria's civil war into Lebanese territory.

Dozens of people were killed in the battle between the army and Islamists from groups including the Islamic State, which has seized large areas of territory in Iraq and Syria.

"The army is in control today, but the danger has not entirely gone, especially given that the terrorists have hostages," said Amin Hteit, a Lebanese military affairs expert and retired army general.

The dead include 17 Lebanese soldiers. A Syrian doctor in Arsal put the total civilian death toll at 42, while security sources have reported dozens of fatalities among the militants.

About half a dozen armoured personnel carriers mounted with machine guns rolled uphill toward Arsal on Thursday afternoon, though there were no signs of fighting. Ambulances sped away on the main road, where speed bumps had been removed.

Speaking on the road outside Arsal, Abdullah Zogheib of the Lebanese Red Cross said medics had entered the town in the morning and evacuated 42 wounded people, mostly women and children.

"Most of them had very serious wounds. They had been shot by bullets, some in the head, and there were amputees from shell fire," he said, adding the situation in town now seemed "normal" and that people were walking in the streets.

"We didn't see any gunmen. We don't know if they were hiding or if they just weren't there."

A Reuters witness saw a convoy of 11 trucks full of women and children with their belongings leaving the town. One of the passengers said the convoy was heading back to Damascus.

Angry women in a nearby village came out of their houses and insulted the convoy as it passed through the highway, some called them "dogs".

Advancing soldiers found three policemen alive and well at a clinic in the town on Thursday, a security official said, but 19 soldiers are still estimated to be missing, presumed taken by the militants. More than a dozen policemen were also taken on Saturday in what the army described as long-planned attack.

One of the withdrawing militants told Reuters the fighters pulled out at dawn and took the hostages with them. "They could be released later in stages," he said. A security source confirmed the militants had taken the captives with them.

The mediators from the Muslim Clerics Association on Wednesday secured the release of three of the soldiers.

In a televised new conference from the outskirts of Arsal, one of the mediating clerics said the town was "almost clear" of militants. "Within hours everything will be over," he said.

FIRST MAJOR INCURSION

The Arsal incursion followed setbacks for rebels fighting President Bashar al-Assad over the border in Syria's mountainous Qalamoun area, where government forces backed by Lebanese Shi'ite group Hezbollah have driven them from major towns.

Syrian warplanes bombed the border area on Thursday after the militants' withdrawal from Arsal, a security source and a Syrian witness in the town said.

The seizure of Arsal was the first major incursion by hardline Sunni militants - leading players in Sunni-Shi'ite violence across the Levant - since Syria's conflict broke out more than three years ago.

Arsal is a Sunni Muslim town at the border where tens of thousands of Syrian refugees have taken shelter. Their camps were badly damaged in the fighting, Syrian activists say.

Ninette Kelley, representative of the United Nations High Commissioner for Refugees in Lebanon, said many refugees had lost their homes because the makeshift shacks had been burned, and some were now totally without shelter.

"The situation is very fluid and very dramatic and very unsettling," she told Reuters. Lebanese officials had told the UNHCR that more than 800 families had left Arsal and settled in other areas in Lebanon.

Kelley said her agency was aware of reports a convoy had been organised to transport 100 to 200 families - up to 2,000 people - back to Syria and was trying to ensure everyone in the convoy was returning voluntarily.

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