Islamic State fighters traded sniper fire and mortar rounds with Iraqi troops and allied Shi'ite militia forces on Sunday in the city of Tikrit amid reports the militants had used chlorine as a chemical weapon elsewhere in the country earlier this year.

A military official returned from the front in Tikrit said no major advances were made by either side nearly two weeks into an operation to win back the city IS fighters seized last June.

Iraqi Kurdish authorities said on Saturday they had proof the radical Islamist militants occupying large parts of the country's north and west used chlorine against Kurdish peshmerga fighters in January in a car bombing attempt west of the city of Mosul.

The Baghdad government has not issued a statement on the semi-autonomous Kurdish region's announcement. An official reached by Reuters on Sunday declined to comment.

But the mayor of a town on the northern edge of Tikrit told Reuters that storage containers filled with chlorine were found by troops and mainly Shi'ite militiamen when they entered al-Alam last week, the day before they fought their way into Tikrit.

"We found a number of storage units containing chlorine that we think were seized by Daesh from water purification stations in different parts of Tikrit," Laith al-Jubouri said, using the Arabic acronym for the group. He said security forces had sealed off the area where the containers were found and alerted Baghdad authorities.

On Tuesday, when Iraqi forces and allied militias pushed Islamic State fighters out of the town, a Reuters photographer was present when Iraqi police instructed journalists to stand back and hold their breath as they detonated a roadside bomb they suspected contained chlorine.

When they detonated the bomb, a yellowish plume burst into the air, and as bystanders coughed, officials shouted "be careful, it's chlorine!", the Reuters photographer said.

The statement from Kurdish authorities about Islamic State's use of chlorine referred to footage of "similar attacks" during the recent fighting around Tikrit, though the mayor and another security official only noted the presence of stockpiles of chlorine found in areas recently seized back from IS.

AWAITING REINFORCEMENTS

The military campaign to retake Tikrit has been stalled since Friday, when security officials said Iraqi forces and their militia allies would wait for reinforcements before moving forward.

Two days later, back-up had not yet arrived, and officials continued to stress the challenges they faced in flushing out militants in street-by-street battles and defusing bombs and booby traps they laid while retreating from parts of the city.

"There were no new pushes today from either side, only scattered skirmishes in the northern and southern parts of the city," Colonel Mohammed Abid al-Jubouri told Reuters by phone after visiting the southern edge of Tikrit on Sunday.

Jubouri said the process of "organizing troops and waiting for reinforcements" was ongoing and did not say when a fresh effort to seize the central districts of the city still held by IS would begin. The militants still hold about half the city, which lies about 160 km (100 miles) north of Baghdad.

The effort to retake Saddam Hussein's home city from the militants who overran it last year has been the biggest offensive yet against the group that has declared an Islamic caliphate on territory it controls in Iraq and neighboring Syria.

Though Sunni residents of areas near Tikrit recently freed from the militants' grip continued to return home on Sunday in trucks carrying white flags, fears remain that sectarian tensions will again rise to the fore after the battle for Tikrit.

"The growing weight of the Shi'ite militias and Iran further weaken the Iraqi state's credibility and structures as well as the standing of local elites" in Sunni areas north of Baghdad like Tikrit, said Maria Fantappie, Iraq analyst at the International Crisis Group.

(Reporting by Ahmed Rasheed; Writing by Maggie Fick; Editing by Rosalind Russell)

Reuters