(reuters) -- The territory captured included a key airbase called K1, the North Gas Company station, a nearby processing plant, a power plant and the industrial district, an Iraqi military statement said.

The Iraqi armed "forces are continuing to advance," it said.

The Kurdistan Regional Government (KRG) did not confirm the capture of these positions but major Kurdish TV channel Rudaw said Kurdish Peshmerga forces retreated form positions south of Kirkuk.

The city of Kirkuk is under Kurdish control but the advance of Iraqi forces to the industrial zone put them in control its southern access.

Iraq launched the operation in the multi-ethnic region early on Sunday, amid an escalating crisis between the Iraqi government and the KRG over the Sept. 25 referendum.

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