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Egypt's army said Tuesday it had launched a "major military operation" against the Islamic State group (IS) in the Sinai Peninsula, killing 29 militants and leaving two soldiers dead.

The army said it launched the operation on Monday morning to "eliminate terrorist elements" around the north Sinai towns of Rafah, Sheikh Zuweid and el-Arish.

It said in a statement that 29 militants were killed along with an officer and a soldier in the fighting.

Sinai tribal sources told al-Araby al-Jadeed on the condition of anonymity that F-16 fighter jets also targeted civilian houses, with no civilian deaths or injuries reported so far.

"Some locals choose voluntary evacuation in fear of airstrikes and shelling", the sources added.

The army often reports large death tolls among the insurgents but they are impossible to verify and there has been little noticeable impact on the ability of IS to carry out deadly attacks on the security forces.

Egypt has been struggling to quell an insurgency in the peninsula since the military overthrew Islamist president Mohamed Morsi in 2013.

The government says hundreds of police and soldiers have been killed, many of them in attacks claimed by IS's Sinai Province affiliate.