DARASHISH VALLEY, Iraq, Oct 22 (AFP) - A shadowy Islamist group suspected of having links with Osama bin Laden's al-Qaeda network has managed to overcome the arrest of its leader and continues to pose a major security headache in Iraqi Kurdistan, soldiers and officials here said.

The group, called Ansar al-Islam (Supporters of Islam), is suspected of being behind a series of recent bombings and assassination attempts in the southeastern part of the Kurdish enclave while it continues to receive mystery outside support.

"They are well dug in and have laid landmines and planted TNT booby traps across the whole area," explained Ramazan Dikoni, a commander of Patriotic Union of Kurdistan (PUK) peshmerga, or militia, battling Ansar al-Islam.

"They have a good supply of weapons -- heavy machine-guns, mortars, ammunition. We think Iraq is supplying them, maybe even Iran, but 100 percent we don't know," he added, pointing to the hardliners' slither of territory next to the Iranian border.

According to local commanders, Ansar al-Islam, which imposes Taliban-style rules in areas under its control, comprises some 1,000 fighters. Of these, some 30 are believed to be al-Qaeda members who fled the US attack on Afghanistan last year.

"They have Arabs from Syria, Lebanon, Jordan, Kuwait," Dikoni asserted during a tour of the frontline area, which sees almost daily exchanges of heavy machine-gun and mortar fire.

Ansar, a successor to a group called Jund al-Islam (Soldiers of Islam), controls a valley and mountaintop positions situated between the Iranian border and the Iraqi Kurd town of Halabja, the scene of the brutal gassing of civilians by the Iraqi air force in 1988.

The group, which carried out a gruesome massacre of 42 peshmerga prisoners last year, has forced the PUK to heavily reinforce the area -- an annoying distraction as the party attempts to gear up for a US-led war against Baghdad.

Troops at the front claimed the group has even carried out crude experiments with chemical weapons on dogs and donkeys.

According to Barham Salih, the PUK's prime minister, Ansar is clearly linked to bin Laden's al-Qaeda network but also backed by Baghdad as a tool to continue harassing the Kurdish enclave, off-limits to Saddam Hussein since 1991.

"This group was established at the behest of al-Qaeda, on the 1st of September last year, with the view of providing an alternative base, or one of several alternative bases, for al-Qaeda as they anticipated September 11," Salih told AFP in the PUK's main base at Sulaimaniyah, around one hour's drive north of the frontline here.

Salih narrowly survived an attempt on his life in April. Seven people, including the two attackers believed to have been sent by Ansar, died in the shoot-out.

"They pose a security problem. These are hardened terrorists that are totally disconnected from the values of our society... and the hard-won gains of the secular democracy we have established," he said.

When asked if he thought Baghdad backed the group, he said: "It does not take a genius to speculate about who gets the most benefit from destablising Iraqi Kurdistan."

But one key question mark is the role of Iran.

The whole topic is very sensitive for the PUK, traditionally dependent on Iran during its past battles with the Kurdistan Democratic Party (KDP), the other main group in this enclave.

Speaking privately, PUK soldiers said they suspected "some elements" in Iran had at least given the group the freedom to move to-and-fro across the border and access weapons -- until the focus on Ansar's activities embarrassed central government in Tehran and sparked visits to the Ansar-PUK frontline from US and British military intelligence.

Dutch authorities, acting on a tip-off from Iran, arrested Ansar leader Mullah Krekar -- whose real name is believed to be Fateh Najmeddin Faraj -- after he was refused entry to Iran last month.

And the government of Shiite Muslim Iran has fiercely denied any links to Ansar, which espouses a hardline Wahabi interpretation of Sunni Islam.

"The Iranians affirm strenuously that they consider this group a threat," said Salih, diplomatically refusing to confirm or deny reports of Ansar's links to Iran.

"I think our Iranian neighbours are mindful of that threat," he added.