by Hassan Abdulzahrah and Jean-Marc Mojon
NAJAF, Iraq, Aug 26 (AFP) - Iraq`s Shiite spiritual leader began a mission to "save" the battered holy city of Najaf on Thursday as 74 people were killed and more than 350 wounded in attacks in nearby Kufa on the main mosque and a demonstration.
Grand Ayatollah Ali al-Sistani, accompanied by thousands of faithful, has been granted a 24-hour truce by Baghdad and US military to negotiate an end to 22 days of fighting against forces loyal to rebel cleric Moqtada Sadr.
But hopes raised by Sistani`s peace mission were dimmed by violence in Najaf`s twin city of Kufa that left at least 74 people dead and the sabotage of eight pipelines in southern Iraq, hampering vital crude exports, officials said.
"We cannot distinguish between those who died in the bombing of the Kufa mosque and those who were killed in the demonstration," a health ministry spokesman said as doctors struggled to cope with the enormous casualties.
Pain-wracked and bloodied patients, mostly men, were stretched out in the corridors and garden of the Middle Euphrates hospital despite the intense heat.
"There were hundreds of us. We came early this morning to the mosque. We were waiting for Sistani, inside and outside. Then at 8:00 am, two mortars exploded, one near the outer gate and the other inside the compound," said Hani Hashim.
Thousands of people chanting slogans in support of Sadr and denouncing interim Iraqi prime minister Iyad Allawi were heading from Kufa for Najaf when national guardsmen opened fire as they passed a military base, an AFP photographer said.
US marines and Najaf`s governor Adnan al-Zorfi denied any involvement in the incident and accused Sadr`s Mehdi Army of being responsible.
National guards also fired on demonstrators from the city of Diwaniya, who tried to enter Najaf from the east. Bloodstains and shoes lay on the ground.
Meanwhile, a large crowd took advantage of the ceasefire in Najaf to force their way into the Imam Ali mausoleum, one of the holiest sites in Shia Islam, which has been held by the militia for four months.
"This is democracy, this is the new Iraq, this is the greatest defeat we could have inflicted on the Americans. It`s the most beautiful day in my life," shouted Akir Hassan, 63, hurrying inside to pray.
Sistani, treated to a euphoric welcome since returning from medical treatment in London on Wednesday, has signalled that he wants all armed groups to disarm in Najaf and Kufa and all foreign troops to leave.
Talks between Sistani and Sadr`s camps started almost immediately, said a spokesman for the ayatollah, but it was not clear if the two leaders themselves had met face-to-face as officials said they had 24 hours to find a solution.
"We have started contacts with Moqtada Sadr and in the coming hours we are waiting, hoping that we will succeed in saving the city from destruction," said Ahmed al-Khaffaf.
Announcing the ceasefire, Allawi said it was a "last call for peace" and "the last chance to put an end to the innocent bloodshed," vowing a "safe passage" for Sadr if he disarmed and quit the shrine.
Governor Zorfi, who has championed the use of US forces in Najaf, said US and Iraqi soldiers would stick to their positions during the truce, warning: "If there is no agreement after 24 hours, the fighting will resume."
Before the ceasefire, US tanks and helicopters pounded militia posts, pinning them back to the immediate area of the Imam Ali shrine.
A dozen bullet holes were visible in the golden dome of the mausoleum and some of its 7,777 golden tiles had come loose, said an AFP correspondent, one of three newsmen inside the building with several hundred Iraqis.
Serious damage to the shrine is likely to inflame religious sensibilities already heightened by the three weeks of fighting, both in Iraq and across the Middle East.
Meanwhile, eight pipelines feeding two southern oilfields were sabotaged in an overnight explosion, dealing a new blow to the country`s vital but beleaguered oil industry, officials said.
They were part of a cluster of 20 pipelines at Al-Barjassiya, said an official at the oil ministry in Baghdad.
Another US soldier was also killed late Wednesday in a mortar attack in Baghdad, military sources said.
An Islamic group, the Secret Islamic Army, meanwhile said it would release seven foreign hostages it has been holding for more than a month when their Kuwaiti firm pledged to no longer operate in Iraq.