BEIRUT, Jan 15 (Yara Bayoumy/Reuters) - Hamas leader Khaled Meshaal called on Egypt on Friday to stop building an underground wall along its border with Gaza, which the Islamist group says would put further strain on the isolated enclave.

Meshaal also called for a meeting with Palestinian President Mahmoud Abbas of the rival Fatah party, to try to achieve reconciliation between the two groups.

Egypt is constructing an underground barrier to stem Palestinian arms smuggling into Gaza and has played down the scope of the work on the 14-km (8-mile)-long frontier.

Hamas calls the project a wall of death that could seal an Israeli-led blockade by closing smuggler tunnels from the Egyptian Sinai peninsula.

We call on the Egyptian leadership to stop building the steel wall along its border with the Gaza Strip, Meshaal said at a conference bringing resistance groups together in Beirut.

A wall (is erected) between enemies and not between brothers, said Meshaal who lives in exile in Damascus.

Israel has long lobbied Egypt to tackle cross-border smuggling, which supplies Palestinians with munitions as well as with basic goods lacking in Gaza.

Egyptian officials have said steel tubes were being placed at several points along the frontier to form a barrier, but have not elaborated on their purpose.

The anti-smuggling wall sparked violence earlier this month when an Egyptian soldier was killed and four Palestinians were wounded in a gun battle during a demonstration in protest against it.


ERASE ALL THE PAST

Israel and Egypt maintain a blockade of the territory, ruled by Hamas Islamists who oppose international efforts to achieve Israeli-Palestinian peace.

Israel imposed the blockade in 2006 after a soldier was seized by militants who tunnelled under the Israel-Gaza border. It has been tightened since Hamas took control of the Gaza Strip from forces loyal to Abbas's Fatah movement.

The blockade has been condemned internationally over hardships caused to Palestinians in the poor coastal enclave and its effect on efforts to rebuild homes and infrastructure since Israel's three-week Gaza incursion a year ago.

Meshaal, who earlier met Lebanese leaders, said his group was in the last stretch towards reconciliation with Fatah and all that was needed was a final review of an Egyptian proposal to promote reconciliation between the two groups.

Egypt has been hosting talks between Hamas and Fatah -- which controls the West Bank -- to try to push the two parties towards a deal.

From this platform, I erase all the past, and I invite the brother Abu Mazen (Abbas) for a bilateral meeting to start with, then with the factions, Meshaal said at the opening ceremony which Hezbollah leader Sayyed Hassan Nasrallah also addressed.

I am confident that when we meet, we will agree, and we will deal with these simple differences. Then we will go to Cairo, with an Arab presence, to bless our unity and our agreement, Meshaal said. (Additional reporting by Laila Bassam; editing by Andrew Dobbie)