Latest reports from government-controlled Vavuniya town said Tamil guerrillas took over the strategic settlements of Puthur junction and Puliyankulam on the highway in northern Jaffna after they overran key towns of Kanagarayankulam and Nayanamadu following the army pull-out from the military base in nearby Mankulam.

In Colombo, an army spokesman said the situation was very grim for the troops, but refused to divulge any detail.

With today's losses, the army seemed to face a total rout in Vanni keeping in control only one town, Omanthai, which too is reportedly under heavy attack from the rebels. Reports from the north said desperate and disenchanted soldiers indulged in arson and looting in Vavuniya while returning fromoperational areas in Vanni.

Unconfirmed reports also hinted at a virtual revolt in a northern army camp with troops refusing to fight and gunning down two military policemen.

Meanwhile, the main opposition United National Party (UNP) claimed over 800 soldiers have been killed so far, while the government continued to peg the casualty figure at 89 and number of injured at 645. Concerned over the situation, UNP leader and party candidate for the December 21 Presidential poll Ranil Wickremesinghe appealed to the soldiers not to be provoked by the LTTE offensive and resort to `individual actions'.

"I urge members of security forces not to act individually but follow orders of the field commanders," he told a public meeting at northwest Kurnegala town.