* Heavy casualties expected from clashes
* South, north agree to resume suspended talks
* Latest upsurge in fighting in south's oil areas
(Adds plans to resume talks, fighting in Upper Nile)
By Opheera McDoom
KHARTOUM, March 17 (Reuters) - South Sudan's army fought militia in two oil-producing states on Thursday, underscoring the challenges ahead as southern leaders agreed to resume talks with the government in Khartoum.
Southern Sudanese this year voted overwhelmingly to become an independent state on July 9 and secede from the north they have fought for all but a few years since 1955.
But the violence has soured relations with Khartoum, who the south says is arming militias, stalling talks on the mechanics of separation.
Leaders from north and south met on Thursday and agreed to restart talks suspended last week, said former South African President Thabo Mbeki, who is mediating the talks. A joint committee of representatives from armed forces in the north and the south will look into documents released by the south alleging Khartoum's support for the militias, he said.
"If there's any truth to any of those allegations, then necessary actions will be taken against whoever it is who could have been involved in any action which is intended to destabilise the government of South Sudan," Mbeki told a media conference.
South Sudan's army (SPLA) spokesman Philip Aguer said a 1,000-strong militia had moved from Khartoum last month to Unity state saying they would join the south's separate army but refused to meet southern officials and had begun to illegally tax civilians.
"They came under the pretext that they were coming to join the SPLA but they spent more than one month guarding against integration," Aguer said. "It was just buying time to recruit more soldiers and receive arms from Khartoum."
HEAVY CASUALTIES FEARED
He said the fighting in Unity had dislodged the militia from their base but that they had yet to receive casualty estimates.
"There will be heavy casualties because they were well armed and the SPLA force which eventually took them on was also well armed," he said.
Aguer said the militia attacked the SPLA during a visit to investigate the taxation complaints early on Thursday and the army responded by attacking their base.
A spokeswoman for the U.N. peacekeeping mission (UNMIS) Hua Jiang confirmed they had reports of heavy casualties during the Unity state clashes but could not confirm who the victims were.
"We have sent patrols out to near the area of the clashes," she said.
The northern Sudanese army denied any involvement in the fighting. The north denies southern accusations that it arms militias there.
Clashes between militias and the southern army in three oil-rich areas have killed hundreds this year, with at least 79 killed in fighting this month in Upper Nile state alone.
Aguer said the two sides had again clashed in Upper Nile on Thursday but said he was still awaiting reports on casualties.
Thursday's fighting will add to international fears of a breakdown in law and order in the south which has long suffered from tribal and ethnic divisions. Critics say the south risks becoming a failed state which could destabilise east Africa if it is unable to maintain security.
Many flashpoints remain over the south's impending secession including demarcating the border, sharing wealth from the oil which lies mainly in the south but is reliant on infrastructure in the north and the disputed central region of Abyei where troops have been seen amassing from both sides. (Writing by Opheera McDoom and Deepa Babington; Editing by Sophie Hares and Louise Ireland)
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