(Adds president's quote, paras 10-11)

By Ranga Sirilal

COLOMBO, Feb 5 (Reuters) - At least 800 civilians caught in raging fighting escaped Sri Lanka's war zone on Thursday, the military said, and the government renewed a call for Tamil Tiger rebels to surrender unconditionally or face destruction.

Battles flared around a shrinking wedge of jungle in the Indian Ocean island's northeast, that the military now measures at about 200 sq km (77 sq miles) and in which the Liberation Tigers of Tamil Eelam (LTTE) separatists are trapped.

Troops killed 15 rebels, including three senior guerrillas, while capturing the northeastern coastal village of Chalai, the last redoubt of the LTTE's Sea Tigers naval wing, military spokesman Brigadier Udaya Nanayakkara said.

Three soldiers died in the battle there, he said. Soldiers also seized Vishvamadu, on the eastern front, he said.

Tens of thousands of civilians are being held in the war zone by the Tigers, under grave threat of harm from the fighting and a lack of food and medicines, aid agencies say.

"At least 800 civilians have come out today," Nanayakkara said.

The LTTE had no immediate comment. Independent confirmation of either side's accounts from the battlefield are impossible to verify since independent media is barred from the war zone.

The pro-rebel website www.TamilNet.com said on Thursday seven people were killed and dozens wounded in shelling at a hospital. The military denies firing into civilian areas.

The United Nations has said at least 52 people were killed and 80 wounded by shelling on Wednesday. Aid agencies say 250,000 people are trapped in Tiger-held areas, but the government says the number is about half that.

President Mahinda Rajapaksa assured U.N. Secretary-General Ban Ki-moon that Sri Lanka would protect civilians in a telephone conversation on Thursday, Rajapaksa's office said in a statement.

"The current military operations to defeat terrorism in Sri Lanka would be carried out without harrasment to the civilian population," the statement quoted Rajapaksa as saying to Ban.

NO CEASEFIRE

The plight of civilians has prompted a growing list of countries, including the United States, the European Union, Japan, Norway and Australia, to raise calls for both sides to negotiate a brief end to hostilities to let the people out.

The government has said it will allow safe passage, but has ruled out any ceasefire.

On Thursday, Prime Minister Ratnasiri Wickremanayake told parliament there had been reports some Tiger fighters were planning to surrender.

"We say it is a wise decision. We will welcome anybody who is giving up arms and entering into the democratic mainstream. We have been saying that from the beginning," Wickremanayake said.

Rajapaksa last gave an offer of amnesty in exchange for total surrender in December. It had always excluded the LTTE's leadership, including founder and leader Vellupillai Prahakaran, whose whereabouts remain unknown.

The LTTE could not be reached for comment but has repeatedly vowed not to give up its fight for a separate state for Sri Lankan Tamils, which has fuelled a civil war that has raged off and on since 1983 and is one of Asia's longest-running. (Additional reporting by Bappa Majumdar and Krittivas Mukherjee in New Delhi; Writing by Bryson Hull; Editing by Michael Roddy)

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