SAKE, Democratic Republic of Congo (Reuters) - Rebels in eastern Congo pushed south along Lake Kivu on Friday after repelling a counter-attack by government forces near the new rebel stronghold in the city of Goma on the Rwandan border.
Others moved north from the strategic road junction at Sake.
A Reuters correspondent there said rebels were in control of Sake after a battle on Thursday which had been the first sign of a government fightback after the army abandoned Goma on Tuesday to the M23 movement, widely thought to be backed by Rwanda.
Local people and fighters said Congolese troops and allied militia had pulled back from Sake, which lies 20 km (12 miles) west along the lake from Goma, to Minova, a further 15 km south along the main highway in the direction of M23's stated next objective, the city of Bukavu at the southern tip of the lake.
Fighters for the group, which said after taking Goma that it would march on the capital Kinshasa - 1,000 miles away - to defeat President Joseph Kabila, met no resistance as they probed several miles south from Sake on Friday, the correspondent said.
Thousands of refugees were fleeing the fighting and heading for Goma, where aid agencies have a significant presence, along with U.N. peacekeepers who stood back when the rebels moved in.
Another town, Mushaki, in the hills 20 km to the northwest of Sake, also fell to the rebels after overnight fighting, according to officials in Goma who were in touch with the area.
Previous uprisings in Democratic Republic of Congo, among them one led by Kabila's father, have been launched from the area, where a mix of colonial-era borders, rich mineral deposits and ethnic rivalries has caused millions of deaths during nearly two decades of turmoil dating from the 1994 genocide in Rwanda.
On the outskirts of Sake, taken by the rebels on Wednesday, three bodies in the uniform of Kabila's national army lay by the roadside and cartridges cases were littered around the area.
"There was heavy fighting," said pastor Jean Kambale, who dismissed a claim a government claim to have retaken Sake on Thursday. "It's M23 who control the town. They never lost it."
REFUGEES
The rebels have had a mixed welcome in areas taken this week. Fearing more fighting, thousands of people, clutching children and belongings, were on the move around the lake on Friday, trudging along the road towards Goma from Sake.
M23 was formed in April by army mutineers who accused Kabila of reneging on a peace deal from an earlier conflict. It now says it plans to "liberate" the whole country and has rejected a call from regional states to withdraw from Goma.
The conflict has raised tensions between Congo and its tiny but militarily powerful neighbor Rwanda, which Kinshasa, backed by United Nations experts, accuses of secretly backing rebels.
Kigali has a history of meddling in Congo's conflicts, which have killed some five million people since 1998. Rwandan President Paul Kagame repeatedly denies the charge and blames Congo and world powers of seeking a scapegoat for their failure.
Minova was the Congolese army's rallying point after their retreat from Goma, the rebels say. After fending off the counter-attack on Sake, seizing Minova would be a step towards the rebels' stated ambition of taking Bukavu.
The capital of South Kivu province, it lies at the opposite end of the lake, 100 km (60 miles) from Goma, capital of North Kivu. But though Kabila's armed forces are on the back foot as the M23 fighters press south, analysts remain skeptical the rebels can make good on their threat to march on Kinshasa in the west without significant, overt support from foreign backers.
In pushing north from Sake, the insurgents were also moving closer to Kichanga, home of Bosco Ntaganda [ID:nL5E8MLKM1], a Rwandan-born warlord who many say controls the insurgency and is wanted for war crimes by the international court at The Hague.
Regional and international leaders are scrambling to halt the latest bout of violence in a Great Lakes region that has long been plagued by ethnic and political conflict fuelled by competition for big reserves of gold, tin and coltan, an ore of rare metals using in electronics and other high-value products.
The rebels have so far ignored international calls to withdraw from occupied areas and say they are doubtful of Kabila's stated readiness to look into their complaints, since they complain of having already waited months for talks.
Regional leaders are due to hold crisis talks on Saturday in Kampala, capital of neighboring Uganda.
Lambert Mende, a Congolese government spokesman, confirmed Kabila was back in Kinshasa from inconclusive talks with Kagame this week. But he said he would return to Uganda on Saturday.
(Additional reporting by Bienvenu-Marie Bakumanya in Kinshasa; Writing by Richard Lough; Editing by David Lewis and Alastair Macdonald)
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