KAMPALA, Oct 18 (Reuters) - Spurred by an international arrest warrant for Lord's Resistance Army (LRA) leader Joseph Kony, Ugandan and Sudanese military forces are seeking to close the net on Africa's most wanted rebel chief.

For nearly two decades, Ugandan troops have unsuccessfully hunted the elusive self-styled mystic across southern Sudan and northern Uganda, where his notoriously brutal fighters have uprooted 1.6 million people in a humanitarian catastrophe.

But now they believe they have him in their sights, and a new offensive to end his 19-year-old rebellion is beginning.

Uganda says it knows where Kony is hiding -- in a Sudanese government-controlled area near the small town of Liria, about 50 km (30 miles) southeast of the southern capital Juba.

In an unprecedented move, Sudan has given Uganda permission for its forces to attack LRA rebels anywhere in the south.

So Kampala has rushed tanks, armoured cars and hundreds of soldiers over the border, its campaign given added urgency by the International Criminal Court's (ICC) issuing of arrest warrants for the LRA leadership.

From Tuesday, Ugandan helicopter gunships will for the first time operate out of the southern Sudanese town of Yei.

But the rebels are fast, mobile and know the area well. Many believe they have some local help. And the latest operations against them have not got off to the best start.

LRA fighters massacred 16 farmers near Juba on Oct. 7, and at least two Ugandan soldiers were killed on Friday in an LRA ambush near Yei in south Sudan, according to Uganda's military.

Kony's deputies, Vincent Otti, Okot Odiambo and Raska Lukwiya, are also believed to be on the run in south Sudan too.

Uganda's upbeat President Yoweri Museveni has told diplomats he expects the LRA chief to be captured, or killed, within weeks. But he has frequently said that in the past.

"We are sceptical, because we have heard all this before," said one Western diplomat.

Diplomats say there is little chance of commandos from a Western nation swooping in to arrest Kony. The U.S. military -- perhaps the group best equipped to launch such a raid -- has not been supportive of the ICC in the past, they say.

The Hague-based ICC has no police force to hunt down its targets, so instead it must rely on Ugandan, Sudanese and former southern Sudanese rebel troops to bring them to justice.

MINES AND MOUNTAINS

The challenges of delivering Kony to ICC prosecutors extend well beyond the region's difficult, mountainous terrain.

Many of southern Sudan's rough dirt roads are mined, and although the Ugandan military has four helicopter gunships, sources say it only has enough fuel to attack known targets, not to mount a systematic search for the elusive Kony.

The 44-year-old, who claims to speak to the Holy Spirit, is thought to be guarded by at least 100 fighters armed with assault rifles, rocket-propelled grenades and mortars.

Tracking him as he walks between camps in the hundreds of kilometres of heavily wooded hills and valleys between Juba and the Ugandan border will be painstaking work.

Another armed force determined to rout Kony is the former rebel Sudan People's Liberation Army (SPLA), which joined the Khartoum government under a January peace agreement.

The SPLA already controls most of the south, but says its efforts to stamp out the LRA have been hindered by elements in the Sudanese military that continue to supply Kony. Khartoum, which backed the LRA for years until 2002, denies it.

An official at Sudan's Defence Ministry told Reuters it was not known where Kony was hiding, but that government, SPLA and Ugandan troops were all hunting for him. "The search is ongoing at the moment," he said. "They are searching in many areas."

U.N. officials are concerned the LRA have accessed transport in recent weeks to cross the river Nile near Juba.

The top U.N. official in Sudan, Jan Pronk, said this was not an indication of official Sudanese army support for the LRA. Rather, he said, there were "dark forces" helping the Ugandan rebels in the south, meaning rogue local elements.

Uganda's military says the LRA may also be getting help from individuals in neighbouring Democratic Republic of Congo (DRC), where a group of rebels led by Otti fled last month.

The Congolese army says they returned to Sudan, but a senior aid worker in the region says LRA fighters now cross the border back and forth almost every week.

"Kony and Otti will fight to the death because they are really hardened," said one Ugandan security official who has worked in southern Sudan. "They have now nothing to lose."