By Manny Mogato MANILA, Aug 31 (Reuters) - The Philippines' largest Muslim rebel group threatened on Sunday to pull out of peace talks with Manila because the government has cancelled a territorial deal after it was challenged in the Supreme Court. Mohaqher Iqbal, chief peace negotiator of the Moro Islamic Liberation Front (MILF), said the rebels would only go back to the negotiating table if the government revived and signed the agreement expanding an autonomous Muslim region in the south of the Catholic-majority nation. "The peace process is now in purgatory," Iqbal told Reuters before he boarded a flight to the southern Philippines. "It was buried by government's decision not to sign the ancestral domain agreement. "We're not only disappointed and frustrated over government's decision to turn its back on the ancestral domain deal, we've completely lost trust and confidence in them. The fate of the peace negotiation rests solely in the hands of the government." The MILF has been in on-off talks with Manila since 1997 to end nearly 40 years of conflict that has killed 120,000 people and stunted growth in the south, an impoverished region believed to be sitting on huge deposits of metals and hydrocarbons. Malaysia has been brokering talks since 2001 and agreed last week to keep about 12 unarmed troops in the southern Philippines for another three months to monitor a ceasefire agreement. Renegade members of the MILF went on the rampage two weeks ago after the territorial deal was halted by the Supreme Court and the military has said nearly 200 people have been killed in fighting in parts of the southern Mindanao region. On Friday, Manila's chief legal counsel formally told the 15-member Supreme Court the government would no longer honour the ancestral domain agreement with the MILF, which was supposed to be signed in Kuala Lumpur on Aug. 5. Jesus Dureza, the president's spokesman, said government has decided to review the entire peace process and consult all sections of society in the south before sitting down with Muslim rebels to find a more acceptable deal based on the country's constitution. "We're not changing the rules of the game," Dureza said in a separate interview with Reuters. "It was the MILF that brought these changes when its forces started attacking villages, killed innocent people and burned houses and farms." SURVIVAL MODE Dureza said the government remained committed on the peace process, "refocusing from one that is centred on dialogues with rebels to one of authentic dialogues with the communities with disarmament as the context of our engagements with armed groups". Iqbal said the MILF was still waiting for Manila to formally inform them of its decision to scrap the territory deal. "We might as well wait for the next president after the 2010 elections," Iqbal said, adding the MILF was no longer confident it could strike a final peace agreement under the administration of President Gloria Macapagal Arroyo. "She is just trying to save her own neck. That's why she was not willing to defend the peace agreement and was also willing to sacrifice everything just to stay in power." Fighting in Mindanao has abated since Friday when troops seized a rebel base, an army spokesman. The miliary has vowed to continue operations during Islam's holy month of Ramadan starting this week. The military has said about 60 civilians have been killed in attacks by MILF renegades on towns in the south and in wayward mortar shelling. In addition, 17 soldiers and an estimated 110 rebels have died. (Reporting by Manny Mogato; Editing by Raju Gopalakrishnan and Alex Richardson)
Philippine Army soldiers carry boxes of ammunitions as they board a military plane bound for Mindanao, southern Philippines during a deployment at Villamor airbase in Manila August 10, 2008. Around 17,000 ...
