( Reuters ) - Chadian rebels surrounded the presidential palace in N'Djamena on Saturday after storming into the capital, and France began evacuating French and foreign nationals from the city.
After a day of fierce clashes in the streets of N'Djamena, there was speculation about the whereabouts of President Idriss Deby, but at least two of his ministers said he remained inside the palace complex at the head of loyal troops.
The official Libyan news agency JANA reported one of the leaders of the rebels, Mahamat Nouri, had agreed to a ceasefire and negotiations with government forces following mediation by Libyan leader Muammar Gaddafi.
But a rebel spokesman, Henchi Ordjo, told Reuters that the rebel fighters were simply holding back an assault on the palace to allow Deby the opportunity to leave.
"No ceasefire has been agreed," he said. Officials at France's Foreign Ministry and Defence Ministry said they could not confirm the JANA report of a ceasefire.
Rebels using pickup trucks mounted with cannon and machine guns had fought their way into the capital after apparently meeting only weak resistance from government forces. They last attacked N'Djamena in 2006 but failed to take it then.
A French air force plane began evacuating several hundred French and other foreign nationals to Gabon, an official at the French military base in N'Djamena said.
The U.S. embassy said its non-essential staff and family members would also be evacuated.
French Defence Minister Herve Morin said France, Chad's former colonial power, which has been accused by the rebels of propping up Deby, would remain "neutral" in the conflict in the oil-producing central African state.
But French Foreign Minister Bernard Kouchner condemned what he called "a brutal attack against an elected and legitimate president". He called for a ceasefire and negotiations.
The United States and the African Union also condemned the rebels' attack on N'Djamena. The AU threatened to kick Chad out of the 53-nation body if the insurgents took power.
Fighting went on during most of the day and residents reported hearing the sound of machine gun, tank and mortar fire.
"The palace looked to be taking the brunt of it; the palace is only less than a kilometer away, so we could hear and feel the attack here," Gabriel Stauring of the humanitarian action group Stop Genocide Now told Reuters in an email from N'Djamena.
Stauring, who has also been writing Internet blogs, said the Meridien hotel where he and other foreign citizens were sheltering, protected by French troops, had come under fire. The French marines fought back, he said.
Despite the rebels saying they had taken over the city, a minister of state in Deby's government, Mahamat Ali Abdallah Nassour, told Radio France International (RFI) that Chad's security forces were "in control in the capital".
He said Deby was still directing government forces from the presidency. Foreign Minister Ahmat Allam-mi said the same.
No details of casualties were available. Saudi-owned Al Arabiya Television reported a bomb had been thrown at the residence of the Saudi ambassador to Chad which killed the wife and daughter of an embassy employee.
The rebels had met little resistance as they advanced across the country from the eastern border with Sudan's Darfur region. Chad says the rebels are armed and backed by the Sudanese government. Khartoum routinely denies such accusations.
A Chadian opposition Web site, Alwihda, said the capital had fallen to the insurgents and added civilians were fleeing the capital towards the border with Cameroon in the south.
Diplomats and residents said it was difficult to tell who controlled the city, where outbreaks of looting were reported.
"We're watching the ebb and flow of battle," one diplomat said, adding army soldiers and rebels on foot and in vehicles were moving around the capital.
The AU said Libyan leader Gaddafi and Congo Republic President Denis Sassou-Nguesso had been asked to monitor the situation in landlocked Chad.
This week's fighting delayed the imminent deployment of a European Union peacekeeping force to eastern Chad.
The leaders of the Chadian rebels include Timane Erdimi, a former member of Deby's ruling clan, and Mahamat Nouri, a former defence minister. They are among several high-level officials who have defected to the rebels in recent years, accusing Deby of ruling like a dictator and favoring his family and friends.
Deby seized power in a revolt from the east in 1990. He won elections in 1996, 2001 and 2006.