Yemeni troops recaptured some territory held by al Qaeda-linked militants, including a munitions factory, and geared up for a push into their strongholds on Monday, killing 26 militants, according to military officials.
The bodies of 12 militants were discovered inside the factory which lies on the outskirts of the al-Qaeda stronghold of Jaar, a military official told AFP on condition of anonymity.
A Yemeni air raid on al-Qaeda positions in Jaar meanwhile killed six jihadists, a local official said.
In the nearby town of Shaqra, where many of the local al-Qaeda leadership is believed to be hiding, fierce clashes between troops and militants killed eight militants, a military official said.
Five soldiers were also wounded in the battles, the official added on condition of anonymity.
The attacks were part of a U.S.-backed drive in a country Washington sees as a front line in its war against Islamist insurgents. An all-out Yemeni army offensive on May 12 had aimed at reclaiming towns and cities lost to al-Qaeda during the past year, including Abyan's capital Zinjibar.
The Yemeni army is trying to retake towns in the southern province of Abyan that were seized by militants last year during a popular uprising against President Ali Abdullah Saleh who formally stepped down in February.
Washington, which helped engineer Saleh's replacement by his deputy, is backing the offensive and has increased drone strikes on suspected al-Qaeda members it believes may be plotting attacks from Yemen.
It has also sent dozens of military trainers and increased aid to Yemen where it wants President Abd-Rabbu Mansour Hadi to reunify the military and focus it against al Qaeda.
A Yemeni military official told Reuters on Monday the army had taken control of a factory used as a base by militants, about 5 km (3 miles) from the center of their stronghold in the town of Jaar.
"We are getting ready to enter Jaar now, we are on the city's outskirts," the military official in the southern Abyan province said. Government troops had already driven militants out of small villages in the surrounding area, he added.
The army battled militants in overnight fighting that continued into Monday morning, killing at least 20 fighters and three soldiers, the official said.
Yemeni warplanes and helicopters struck areas held by insurgents, he said, adding that the number of casualties was not immediately known.
The army is also gearing up to try to take the southern coastal town of Shaqra, the official said. Shaqra is on a major shipping route and the gateway for Somalis entering Yemen to fight alongside al Qaeda.
The military's month-old offensive has cut off supplies of food and medicine and forced thousands to flee their homes, the International Committee of the Red Cross (ICRC) said on Wednesday.
Concerned about the humanitarian and security crisis in Yemen, Gulf Arab states and the West pledged more than $4 billion in aid to the impoverished state last month.
Separately, a Saudi Arabian national, Nasser Abdulaziz al-Mahiri, who was kidnapped six months ago by tribesmen in north Yemen, was released on Sunday after tribal mediation, Yemen's state news agency Saba said on its website.
Kidnappings of foreigners and Yemenis are common in the impoverished Arabian Peninsula state, where hostages are often used by disgruntled tribesmen to press demands on authorities.