(Adds background, context)
RIYADH, July 8 (Reuters) - Three mortars bombs landed inside Saudi Arabia close to its border with Iraq on Monday, causing no casualties but raising concerns about instability in the kingdom's northern neighbour, where Islamist militants have occupied land near the frontier.
Saudi authorities said they are investigating the incident to determine the source of the mortars, which caused no casualties after landing near a block of flats in a new district outside the town of Arar.
The attack was the second near a Saudi frontier in three days, after al Qaeda militants based in Yemen staged a raid in al-Sharurah in south Saudi Arabia in which 10 people were killed.
Last week Saudi King Abdullah ordered the country to a higher level of security following lightning gains made by militants in Iraq, who have declared the creation of a new caliphate and Islamic state on land extending to the Saudi border.
The birthplace of Islam and world's top oil exporter constructed strong border defences with Iraq last decade.
But it is worried that the emergence of the Islamic State militant group - which has shortened its name from the Islamic State in Iraq and the Levant (ISIL) - will encourage more dissent among its own citizens.
Bringing down the al-Saud ruling family is a main goal for al Qaeda, which wants to establish a caliphate in Mecca, and staged attacks on foreigners and government targets in a campaign that was crushed by Saudi security forces last decade.
(Reporting By Angus McDowall; editing by John Stonestreet)
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