The city of 350,000, the southern stronghold in Yemen's civil war, is surrounded by northern troops.
Fighting was reported to be going on south of the strategic town, as northern troops continued their push towards Aden.
A southern military commander on Sunday said the northern troops were spotted 30 kilometres (18 miles) away from the base.
He nevertheless acknowledged that northern troops had advanced on the facility.
But hospital staff refused to give any details, saying only that four northern troops were being treated there.
Correspondents said northern troops had fought their way to within 40 kilometres (25 miles) of the city.
Both areas have been bitterly contested by northern and southern troops.
He said the northern troops did not fire back with the same intensity in order to avoid giving away their positions.
At least 16 northern troops were killed at the base.
The northern troops destroyed hundreds of homes, and those that remained were severely damaged.