Smoke rises into the air near Benghazi port, where clashes are taking place between Islamists and pro-government forces.
Libya's warring factions will resume UN-sponsored talks on Tuesday inside the country to try to resolve a struggle between two governments and parliaments, officials from both sides said on Saturday.
The news came as new clashes between pro-government forces and Islamists in the eastern Benghazi city killed seven soldiers, bringing the death toll of four months of fighting there to almost 700, medics said.
Libya has been in chaos since a NATO-backed revolt ousted Muammar Gaddafi nearly four years ago. Two rival governments allied to armed groups are fighting for legitimacy in a conflict that Western powers fear might lead to full-scale civil war in the oil-producing nation.
Libya's internationally recognised government under Prime Minister Abdullah al-Thinni and its elected House of Representatives are based in the east of the country after a group called Libya Dawn seized Tripoli last summer, set up its own administration and reinstated the old parliament.
Last month, the U.N. managed to bring some members of the factions to talks in Geneva but the Tripoli-based parliament known as General National Congress (GNC) wanted the dialogue to take place inside Libya.
"The UN sponsored peace talks will take place in Libya on Tuesday unless anything unforeseeable happens," Emhemed Shoaib, deputy speaker of the House of Representatives, told Reuters.
GNC member Abdul-Qader Hwaili confirmed the date, and like Shoaib he declined to disclose the venue.
Last week, UN Special Envoy Bernadino Leon said during a visit to Tripoli that the talks would restart within days. A first UN sponsored round of talks in the southern city of Ghadames was held in September but made no progress.
The UN is hoping to get both sides to agree on a national unity government. It plans to arrange local ceasefires and prisoner exchanges as a first step to defuse the conflict.
The conflict has been complicated by a separate battle in Benghazi, the country's second-largest city, where forces allied to Thinni launched an offensive in mid-October to expel Islamist armed groups such as Ansar al-Sharia.
Army forces fought for the third day with Islamists holed up in the port area, residents said. Seven soldiers were killed and 41 wounded, medics said.
"The port is under the control of the army," said Farraj al-Barassi, a military commander.
But a Reuters reporter could still hear heavy fighting near the port and in two other districts where many residential and government buildings have been damaged.
© Thomson Reuters 2015