NAJAF, Iraq, (AFP) – Radical cleric Moqtada Sadr apparently refused to disarm his militia following a “final call” from Iraq’s prime minister to renounce arms yesterday, as fierce shelling pounded Najaf after nightfall.

Deafening artillery fire engulfed central Najaf, as US warplanes and helicopters screeched overhead and smoke filled the sky above the Old City, at the heart of which lies the Imam Ali shrine.

For more than two weeks, Sadr’s Mehdi Army has been locked in heavy fighting with US-led Iraqi government forces on a mission to crush his militia.

Amid what one AFP correspondent called the heaviest shelling in the Old City since the conflict began, Sadr refused in a letter to disarm but urged his fighters to hand over the shrine to Iraq’s highest Shiite authority, the Marjayia.

The letter was addressed to “my dear brothers inside the shrine of Imam Ali” and signed by the cleric, but no immediate confirmation of its authenticity was possible.

“Everyone knows this army is the foundation of the Imam Mehdi and I don’t have the right to dissolve it,” said the text, a copy of which was obtained by AFP, referring to the 12th Shiite imam.

Speaking to Al-Jazeera television, Sadr aide Aws al-Khafagi confirmed that the cleric had called for the keys to be handed over to the Marjayia.

The government has repeatedly called on the firebrand cleric to quit the shrine, lay down his arms and join mainstream politics.

“You have to deliver the keys of the shrine to the Marjayia as soon as possible to prevent the infidel from entering this holy place,” the letter said.

US tanks were positioned just 200 metres (yards) from the mausoleum, trapping the Mehdi Army inside one of Shiite Islam’s holiest pilgrimage centres.

Just hours earlier, Prime Minister Iyad Allawi urged Sadr to respond in person to government calls to disarm after defiant Sadr followers threatened to torch oil fields and die as martyrs.

“We have only heard from people who work with him… we would like to hear from him his final position before we move to the next stage,” Allawi said.

A senior government official later said the shelling was part of a military strategy aimed to shock the militia.

In the afternoon, eight people were killed and 30 wounded when mortar bombs smashed into the provincial police headquarters in Najaf, police and medics said.

Heavy fighting has reduced the historic Old City to rubble, with naked wires and spent mortar and rocket shells strewn across the deserted streets.

Further south, the Mehdi Army torched the offices and warehouses of the Southern Oil Company here, an official at the firm said, shortly after a Sadr aide in Basra threatened to attack oil infrastructure over the Najaf conflict.

“We will not leave a single coalition base untouched and we will attack oil wells if attacks on Najaf continue,” Sheikh Ahmed Fartusi, who called himself the Basra commander of the Mehdi Army, had told AFP.

Previous threats to oil infrastructure in southern Iraq have caused production to be halted and pipelines to be shut down, helping to send oil prices soaring.

Government officials have voiced increasing impatience with Sadr.