Sudan's army on Wednesday confirmed it attacked an area near the South Sudanese border where Darfur rebels had set up a compound, but South Sudan accused Khartoum of bombing a market area on southern territory.

"We attacked Al-Regaibat which is 40 kilometres (25 miles) north of the international border with South Sudan and 10 kilometres north of Samaha," army spokesman Sawarmi Khaled Saad said in a written statement.

The incident adds to growing concern over delays in implementing security and oil deals which the leaders of Sudan and South Sudan hailed in September as ending conflict, after they fought along their undemarcated border in March and April.

Saad alleged that the rebels must have had "great support" from South Sudan.

"We confirm that we conducted our battle deep inside Sudan," the army spokesman said.

burs-it/bpz