The renewed clashes in eastern Chad have strained relations with Khartoum and multiplied the risks for a planned European Union peacekeeping force that is due to deploy in the region to protect civilian refugees and aid workers.

The Chad government said on Wednesday its army had tracked down and destroyed fleeing remnants of the rebel Union of Forces for Democracy and Development (UFDD) after a major battle on Monday in which both sides said hundreds had been killed.

But UFDD leader Mahamat Nouri, a former defence minister who defected to join a two-year-old eastern insurgency against President Idriss Deby, rejected what he called government "lies" and said fighting had resumed early on Thursday.

"There has been violent combat since 7 o'clock," he told Radio France International (RFI), saying he was speaking from the battle zone in eastern Chad.

He said French aircraft, part of a French military contingent stationed in the landlocked former French colony under a bilateral defence treaty, were flying reconnaissance flights for the government over the rebel positions.

Chadian army sources, who asked not to be named, also confirmed renewed clashes on Thursday after an army column advanced from the garrison town of Guereda and attacked the rebels in their mountain stronghold at Hadjer-Marfaine.

"After fighting finished yesterday at nightfall, we started again this morning. We are chasing them towards the (Sudan) border," one army source said.

There was no independent confirmation of the fighting or information on casualties.

The reported combat is the heaviest in months in east Chad, where up to 3,700 EU peacekeepers are due to start deploying early next year to protect refugee camps housing more than 400,000 Chadian and Sudanese refugees.

CEASEFIRE WRECKED

The EU force for Chad, which will also send soldiers to northeast Central African Republic, will try to help contain a widening conflict in Sudan's Darfur region which has pushed armed raiders and refugees across the border.

It will complement a bigger United Nations/African Union peacekeeping force planned for Darfur, where political and ethnic conflict triggered by a 2003 rebellion has killed at least 200,000 people, experts say.

The United Nations, anxious to create a "peace to keep" in both east Chad and Darfur, has lobbied for political settlements to pacify one of Africa's most violent zones.

The UFDD and another rebel group, the Assembly of Forces for Change (RFC), abandoned a 30-day-old ceasefire at the weekend and accused the government of not honouring parts of a Libyan-brokered peace accord signed last month.

Chad has protested to Khartoum over the latest fighting, saying the UFDD rebels crossed the border from Sudan.

In his comments broadcast on RFI, Nouri dismissed as "hallucination" a Chad government report on Wednesday which said he had been forced to cross the border to Sudan on foot after his forces were caught and decimated by government troops.