N'DJAMENA - Chad's army attacked an anti-government rebel group for a second day on Tuesday, trying to dislodge the insurgents from their mountain hideout near the eastern border with Sudan's Darfur region, army sources said.

The latest clashes occurred after government troops moved on Monday against fighters of the rebel Assembly of Forces for Change (RFC) sheltering in the rugged Kapka mountain range northeast of the town of Biltine.

President Idriss Deby's forces have been engaging at least three rebel factions in the heaviest fighting in months in eastern Chad following the collapse of an October 25 peace accord.

The renewed conflict comes just weeks before a European Union peacekeeping force of up to 3,700 troops is due to deploy in eastern Chad on a United Nations mission to protect civilian refugees and foreign aid workers.

Chadian army sources, who asked not to be named, said government forces moved against the RFC from several directions.

"The rebels were encircled in a 'wadi' (dried-out riverbed) near the Kapka massif ... They were embedded in caves. Fighting was heavy," one of the sources told Reuters.

An RFC spokesman, Id Moura Maide, also confirmed fierce clashes. "There is still violent combat going on," he told Reuters by phone.

There was no immediate word on casualties.

The RFC and another rebel group, the Union of Forces for Democracy and Development (UFDD), ended a Libyan-brokered ceasefire more than a week ago, abandoning a pact signed with Deby by several rebel groups fighting to end his 17-year rule over the landlocked African country.

FEARS FOR REFUGEES

The government army fought several major battles with the UFDD last week, which both sides said had killed hundreds.

A third armed group called the United Front for Democratic Change (FUC), which is loyal to a defence minister sacked over the weekend, has also clashed with government troops around the eastern town of Guereda.

The U.N. refugee agency UNHCR said the fighting over the last 10 few days had limited its access to some of the dozen refugee camps it runs in eastern Chad for 240,000 Sudanese refugees from Darfur and 180,000 Chadians displaced by violence.

"Refugees, internally displaced persons (IDPs), as well as the local population, have told UNHCR that they live in fear that the already volatile situation may worsen," a UNHCR spokesman in Geneva said.

But he added the clashes mostly took place away from inhabited areas and had not caused any fresh population movements. Essential services in the refugee camps were still being provided.

More than 130 humanitarian aid workers from various organisations had been relocated to the main eastern town of Abeche after being blocked for more than a week by fighting in Hadjer Hadid, east of Abeche, the UNHCR said.

Diplomats fear the renewed conflict may further hamper the deployment of the EU peacekeepers, which has already been delayed until the New Year. Its commanders say EU member states have been slow in coming forward with commitments to provide essential aircraft, helicopters and medical units.