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On the streets: troops patrol Nueva Loja

Quito struggles to quell riots

Ecuadorean troops took control of government buildings in two Amazon provinces and reinforced security at oil wells yesterday as they moved to quell protests that have slashed crude production and exports, a senior officer said.

Acting after President Alfredo Palacio declared a state of emergency in the provinces of Sucumbios and Orellana late on Wednesday, security forces fired tear gas at protesters in the eastern jungle city of Lago Agrio, in images shown on local television.

The disturbances, which are throttling the country's principal source of export income, are the worst faced by Palacio since he came to power in April.

Ecuador's crude oil output has collapsed since protesters invaded oil camps, sabotaged equipment and blocked highways on Monday.

The protesters are demanding foreign oil companies operating in the region provide financing for infrastructure projects and more job opportunities.

State-owned Petroecuador's production has fallen to zero from its usual 201,000 barrels per day, Palacio said in a televised address to the nation in which he blamed the protest on "a diabolical plot" by political enemies.

The country would also import fuel to meet local needs, Palacio said, without saying how much.

The company earlier declared force majeure on its oil exports.

Government troops ejected protesters from government buildings in Sucumbios province and also took control of government offices in Orellana.

"Our instructions are to restore order," General Gonzalo Mesa, who is in command of the operation, told Reuters. Despite the visual evidence of clashes in Lago Agrio shown on television, he said there had been no protests in the city.

Sucumbios prefect Guillermo Munoz, a senior elected provincial official, said his province's people were in revolt and challenged the army "to throw us all in jail."

Palacio was appointed after Congress fired President Lucio Gutierrez during mass protests against his interference with the Supreme Court.

Labour Minister Galo Chiriboga accused Gutierrez, currently in exile in Peru, of being behind the Amazon unrest.

But in his address to the nation, Palacio stopped short of naming the political rivals he believes are behind the protests which he said threatened "the stability of the Ecuadorean state".

"This is part of a diabolical plot which I have denounced in the past and has been a long time in the planning," Palacio said.

The state of emergency restricts rights to free association and expression and restricts people's movements. It also allows the government to censor news media working in the area hit by the protest.

Demonstrators also want the government to renegotiate contracts with international oil companies, including Occidental, Petrobras and EnCana, to raise state participation.

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