Sunni extremists in Iraq captured three towns in the northern part of the country, causing thousands to flee to the mountains and threatening Iraq's biggest dam.

The extremists further expanded their territory when they captured three towns stretching north and west, from Mosul to the Syria-Turkey border after routing Kurdish security forces called the peshmerga.

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However, seizing control of the Mosul Dam would be a greater victory because it could give extremists power to release a deadly flood on large towns below, NDTV explained.

Early Sunday morning, the Sunni fighters took Sinjar town, brutally smashed a Shiite shrine, killed resisters, and raised the Islamic State of Iraq and the Levant flag over government establishments. Baghdad-based United Nations representative Nickolay Mladenov called the incident a "humanitarian tragedy" and said 200,000 civilians fled the community.

Later on Sunday, the militants seized Wana, a town adjacent to the Tigris River and just a short distance from the Mosul Dam, a major power and water supplier in the country. The Islamic State captured the town of Mosul, the second-biggest city in Iraq, on June 10.

A report released by Pentagon watchdog Office of the Special Inspector General for Iraq Reconstruction seven years ago warned that the Mosul Dam's structural problems could pose a threat should the Islamic State gain control of the dam.

The report said that if the dam fails, it could release a 65-foot wave across northern Iraq and this could result in fatalities and property damage.

Last year, the Islamic State seized Fallujah and its dam. The militants opened the gates of the dam, flooded the farmlands, and cut off southern Iraq's water supply.

Washington officials are now weighing how they would respond to the Iraq crisis.

In the meantime, Iraq is still struggling to form a new government on the heels of its April elections so they put off decisions to send more military personnel to Iraq.

The Kurds recently requested military help from the U.S. to resist the Islamic State. The Shiite-dominated government of Iraq would most likely not allow the U.S. to supply the Kurds with weapons for fear it would encourage them all the more to establish a new state.

As of now, U.S. officials hope Iraqi Prime Minister Nouri al-Maliki would be replaced by another leader who could convince the Shiites, Kurds, and Sunnis to unite under one national government. The Shiite parties are set on Friday to nominate a new candidate who would spend the next 30 days forming a new government.

TagsSunni, Iraq, Kurds, Mosul Dam, Turkey, NDTV, Islamic State of Iraq and the Levant, Nickolay Mladenov, Baghdad, Tigris River, Office of the Special Inspector General for Iraq Reconstruction, Fallujah, US, Nouri al-Maliki, Shiite