By Marwa Awad

CAIRO (Reuters) - Egypt's military said on Wednesday it would broaden its offensive against militants in the Sinai Peninsula, a campaign that has raised concerns in Israel about the movement of heavy armor into the area near its border.

After militants attacked and killed 16 border guards on August 5, Egypt launched an operation using the army and police to raid militant hideouts, arrest suspects and seize weapons, including rockets and other arms, that are rife in the area.

Disorder has spread in Sinai since President Hosni Mubarak's overthrow last year. Analysts say Islamists with possible links to al Qaeda have gained a foothold. This has alarmed Israel.

But Israeli officials have also privately voiced concerns about heavy equipment being sent to an area where there are restrictions on weapon deployments under a 1979 peace treaty.

Egyptian President Mohamed Mursi told Reuters on Monday in his first interview with international media that Egypt was committed to all treaties and, without naming Israel, said no other states should worry about its actions in Sinai.

"As of the morning of August 29, in continuation of the military operation, there will be a redeployment of forces in various locations in Sinai to complete the hunt for terrorist elements," the Defence Ministry said in a statement.

A military source told Reuters this would involve spreading security forces over a wider area to root out militants.

The campaign is led by the defence minister and head of the armed forces, General Abdel Fattah al-Sisi, appointed by Mursi in a shake-up of the military top brass on August 12. The Islamist president has promised to restore order.

Sisi briefed Mursi on the Sinai operation on Monday.

The ministry statement on its website said 11 militants had been killed and 23 arrested in the campaign. It said 11 vehicles had been seized, along with ammunition, including five boxes of Israeli-made ammunition, but did not give details.

NEGLECTED REGION

Egypt has not given details of the equipment it has sent to Sinai, but security sources had said aircraft and tanks would be used. Egyptian television has shown images of Sisi speaking to troops in Sinai at a camp with tanks and other heavy weaponry.

The unrest has occurred mainly in North Sinai, where many people have guns and where Bedouin tribes have long complained of neglect by central government. They say they have seen no benefits from the expanding Sinai tourist resorts.

Mubarak's military-backed government worked closely with Israel to keep the region under control. Diplomats say security contacts continued after Mubarak's fall. But Egyptian security sources said Israel should not expect day-to-day reports.

The 1979 peace treaty limits the military presence in the desert peninsula though in recent years Israel has agreed to allow Egypt to deploy more forces there to stem weapons smuggling by Palestinian gunmen and crime.

Israeli officials, who say they are in regular contact with Cairo, have encouraged Egypt to take tough action against the gunmen behind the August 5 assault and have previously approved the use of helicopters in the operation.

No one has claimed responsibility for the killing of the border guards but a Sinai-based Islamist militant organization, the Salafi Jihadi Group, warned the Egyptian army last week that the crackdown would force it to fight back.

(Editing by Edmund Blair and Alistair Lyon)