Saudi allies suspend Iran ties over Shiite cleric row Read more

In Monday's attack, IS fighters first launched a suicide bomb attack at a checkpoint at the entrance to the town, the AFP news agency reported, and that was when the guards were killed.

ISIS has been trying to push east from its stronghold of Sirte for several weeks to reach the country's "oil crescent", where main oil terminals such as Al-Sidra and Ras Lanouf are based.

Es Sider and nearby Ras Lanuf oil ports, between Sirte and Benghazi on the Mediterranean coast, have been closed for more than a year amid fighting between rival factions for control of the North African state and its energy reserves.

"We were attacked by a convoy of a dozen vehicles belonging to IS", Bashir Boudhfira said. A Libyan official estimated the facility now contained 500,000 barrels of oil.

The Takfiri group also said on its Twitter account that its militants conducted an "attack on the Al-Sidra area followed by violent clashes" with army forces.

IS group claims capture of Libyan town Read more

CBS News' Khaled Wassef said ISIS' Libya branch released an online statement earlier in the day claiming to have taken control of the coastal city of Bin Jawed, about 120 miles east of Sirte. "They then launched an attack on the town of Ras Lanouf via the south but did not manage to enter".

Approximately 6,000 European and United States soldiers, including 1,000 British troops, will be involved in a number of offensives set up to halt the advance of the jihadist terror group.

But unrest has forced a major slump in production.

Control of Libya is confused and complicated since Gaddafi's government was deposed, in the West the official government in exile sits in Tripoli while in the East opposition forces are based in the East at Benghazi and Tobruk.

The UN is pressing both sides to accept a power-sharing agreement it hopes will help reverse gains made by Isis.