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RUSSIA SHELLS KEY CHECHEN VILLAGE

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Russian guns shelled a strategic village outside the capital of Chechnya on Thursday, but fighting eased as a thick fog settled over the separatist republic.

Moscow warned Chechens to lay down their arms Thursday or face the consequences and said Russian soldiers had already entered the northern and western outskirts of the capital, Grozny, and were advancing from the east."The southern direction has been left open to allow (militants) to leave the conflict zone," said a Russian government statement.

Chechen military officials told Russia's Interfax news agency Thursday that Pervomaiskoye, nine miles northwest of Grozny, had been "nearly obliterated" by the latest shelling.

Chechen officials said 20 villagers were killed and many wounded, and accused the Russians of aerial bombing raids. The Russians denied the accusation.

The Kremlin warned the Chechens to stop fighting or face "all consequences of their criminal recklessness." The exact timing of Thursday's deadline was unclear.

On a small collective farm near Grozny, about 50 women and children spent the night in a makeshift bomb shelter beneath a grain elevator. Dim light flickered from kerosene lamps and candles, and water dripped from the ceiling.

"I've been here all night," said 33-year-old Khava Mikayeva, her eyes red with exhaustion. She held the youngest of her seven children in her arms. "I have no relatives in the mountains," she said. "We have no place to go. We have a few loaves of bread, but that's all."

An estimated 10,000 to 40,000 Russian soldiers, supported by tanks, warplanes and helicopter gunships, rolled into Chechnya on Sunday to disarm its forces and oust what Moscow considers a "criminal" regime.

Chechnya, located in the Caucasus Mountains 1,000 miles southeast of Moscow, declared independence in 1991, but Russia has refused to recognize the oil-rich republic's claim.

Still, the confrontation is a big gamble for the Russian president, Boris Yeltsin. Fears persist in the State Duma, the lower house of parliament, that Russia could become embroiled in a prolonged occupation of Chechnya similar to the Russian occupation of Afghanistan in the 1980s.

Chechnya's rebel president, Dzhokhar Dudayev, withdrew his delegates from peace talks on Wednesday and urged the 1.2 million residents of his predominantly Muslim republic to fight to the death.

In a communique Wednesday night, Russian authorities urged Dudayev "to realize his responsibility to his own people and not burden his conscience with new crimes."

Moscow said 15 soldiers have been killed in the heavy fighting. Russian media reports put the number at 70 or more. Chechen authorities say dozens of civilians have died.