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Rebels stormed a Chinese-run oil field at dawn in eastern Ethiopia on Tuesday, killing 74 workers and destroying the facility, the guerrilla group and government officials said.
The Ogaden National Liberation Front, an ethnic Somali group that has fought alongside insurgents in Somalia, also kidnapped seven Chinese workers, said senior Ethiopian government official Bereket Simon.
"This was a cold blooded killing," Bereket, a special adviser to the Ethiopian Prime Minister Meles Zenawi, told The Associated Press. "This was organized."
The rebel group claimed responsibility for the attack in a statement sent to the AP, saying it had launched "military operations against units of the Ethiopian armed forces guarding an oil exploration site," in the east of the country.
It also warned all international oil companies not to operate in the region. It did not give any details of casualties, but said they had "wiped out" three Ethiopian military units.
China's official Xinhua News Agency identified the Chinese workers and Ethiopian guards as employees of the Zhongyuan Petroleum Exploration Bureau, a division of China Petroleum & Chemical Corp., a huge state-run oil company better known as Sinopec.
Xu Shuang, the general manager of Zhongyuan Petroleum Exploration Bureau, based in Addis Ababa, said nine of its Chinese oil workers were killed, seven Chinese workers were kidnapped and 65 Ethiopians were killed in the fighting.
The Zhongyuan official, whose company began working in Ethiopia's volatile Somali Regional State last year, declined to give further details of the attack.
The attack took place early Tuesday morning in Abole, a small town 120 kilometers away from the state's capital Jijiga, close to the Somali border. Bereket said several Ethiopian troops were wounded in the gunbattle.
"The army is pursuing them. We will track them down dead or alive. We will make sure these people will be hunted and be brought to justice."
He said the group was also linked to the Eritrean government, which Ethiopia has repeatedly accused of waging terror attacks. Eritrea denies the claims.
Both countries fought a bloody border war that ended in 2000 and are accused of backing rival sides in the Somali conflict.
China has increased its presence in Africa in recent years in a hunt for oil and other natural resources to feed its rapidly growing economy.
Its forays into areas considered politically unstable, however, has exposed Chinese workers to attacks.
The Ogaden National Liberation Front issued a warning last year that any investment in the Ogaden area that also benefited the Ethiopian government "would not be tolerated."
The Ogaden National Liberation Front has been waging a low-level insurgency with the aim of creating an independent state for ethnic Somalis. Somalia lost control of the region in a war in 1977.
The region, which is the size of Britain and home to around 4 million people, is one of the poorest in Ethiopia with bad communications and roads.
The rebel group also has been fighting Ethiopian troops inside Somalia, where Ethiopia has been backing the government in crushing an Islamic movement and re-establishing control over the country.
In Nigeria, armed militants seeking a greater share of that country's oil wealth kidnapped nine Chinese oil workers in January, and two more in March. Two were still being held, though hostages are normally released unharmed in Nigeria, after a ransom is paid.
Also in March in Nigeria, five Chinese telecommunications workers were abducted for two weeks.
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