Iraqi Kurdish leader Massud Barzani insisted Friday that a controversial September 25 independence referendum for his autonomous Kurdish region in northern Iraq will go ahead, even as last-minute negotiations aimed to change his mind.

Iraq's Kurds have faced mounting international pressure, including from neighbouring Turkey and Iran, to call off the referendum that the UN Security Council has warned was potentially destabilising.

"The referendum is no longer in my hands, nor is it in those of the (political) parties -- it is in your hands," Barzani told a large crowd at a football stadium in the regional capital Arbil.

"We say that we are ready for serious open-minded dialogue with Baghdad, but after September 25, because now it is too late," he said of Monday's plebiscite.

On Saturday, the veteran Kurdish leader is to hold a news conference at which he is expected to announce definitively whether the vote will take place.

Negotiations are still taking place aimed at persuading Barzani to postpone any referendum, according to officials close to the discussions.

"Nothing is definitive yet. Discussions are continuing to try to offer him serious guarantees that will convince him to change his mind," said one official who did not wish to be identified.

In Ankara, Turkey's National Security Council, chaired by President Recep Tayyip Erdogan, slammed the planned referendum as "illegitimate", indicating that Ankara was prepared to retaliate if it went ahead.

It warned that Ankara was prepared to use its "rights" in line with international agreement, with specifying what action it could take.

On the Iranian front, a commander of its elite Revolutionary Guards, Major General Qassem Soleimani, held talks with Barzani in Arbil.

"It's his last visit before the referendum to advise Kurdish officials that Iran is seriously hostile to it and warn them to call it off," a provisional source said.

- Iran, Turkey concerns -

Iran and Turkey both have sizeable Kurdish populations of their own and fear the vote in northern Iraq will stoke separatist aspirations at home.

The Iraqi government is also opposed to the referendum in the oil-rich Kurdish region, which it has called unconstitutional.

In 2014, after a dispute over oil exports, Baghdad decided to suspend payments to Barzani's Kurdish regional government of 17 percent of Iraq's national budget.

Wages, including those of Kurdish peshmerga fighters, were slashed after the end of those transfers, which were worth around $12 billion (10 billion euros) and made up 80 percent of the region's budget revenues.

"The Iranians are still pushing for negotiations between Kurdistan and Baghdad," the source said.

Soleimani has told Kurdish officials that "Iran is pressuring Baghdad so it accepts Kurdish demands and solves the issues of the budget, peshmerga salaries and disputed areas".

- 'Potentially destabilising' -

Iraqi Kurdistan has since 2003 been made up of the three provinces of Arbil, Dohuk and Sulaimaniyah, but its leaders have laid claim to other areas that are constitutionally under Baghdad's authority, including the oil-rich province of Kirkuk.

The Iraqi Kurds would like these disputed areas to take part in the vote.

On Thursday, the UN Security Council warned that the referendum was "potentially destabilising".

The council urged "dialogue and compromise" to address differences between the Iraqi government and the regional authorities.

It also said the vote could weaken the military campaign against the Islamic State jihadist group, "in which Kurdish forces have played a critical role".

Baghdad this week launched offensives to oust IS from the last two pockets it controls in Iraq.

Despite tensions over the referendum, Iraqi forces on Friday recaptured IS-held Sharqat on their drive to retake the nearby northern town of Hawija back from the jihadists.

On the political front, Prime Minister Haider al-Abadi said on Tuesday he rejected an independence referendum under any form, even non-binding. The poll was "rejected, whether today or in the future," he said.

- Iraqi president initiative -

On Wednesday, Saudi Arabia urged Barzani to cancel the referendum to avoid further "crises" in the region.

But the Iraqi Kurdish leader has refused to give in, and on Thursday rejected an initiative from Iraqi President Fuad Massum -- himself a Kurd -- for negotiations.

Massum, in a document seen by AFP, suggested starting UN-backed talks towards a deal with Baghdad.

In areas disputed between Arbil and Baghdad, some have issued strong warnings against the vote.

In the town of Tuz Khurmatu in the province of Salaheddine, an official from the Hashed al-Shaabi paramilitary umbrella group has said he will not allow the poll.

"We're ready for a fight to the death," said Atef Annajar, whose group is dominated by Iran-backed Shiite militias, adding however that "the leadership is trying to calm the situation".

Hadi al-Ameri, head of the powerful Iran-backed Badr organisation, last week vowed to defend the unity of Iraq, warning that the poll could trigger partition and civil war.