* Renamo’s Dhlakama says will challenge via legal channels
* African observers deem vote largely free, EU more cautious
* Fears that disputed election may threaten stability
* Fast-growing Mozambique developing huge gas deposits (Updates with Dhlakama interview, report from EU observers)
By Pascal Fletcher and Manuel Mucari
MAPUTO, Oct 17 (Reuters) - Mozambique’s main opposition group, the former rebel movement Renamo, said on Friday it would challenge as fraudulent results showing the ruling Frelimo party had won national elections, but Renamo’s leader promised there would be no return to war.
Afonso Dhlakama, whose guerrillas fought a civil war against Frelimo from 1975 to 1992 in the former Portuguese colony, said Wednesday’s presidential and legislative elections had been marred by widespread irregularities, including ballot stuffing.
The elections have been billed as crucial for Mozambique’s stability as it prepares to reap revenues from large offshore gas deposits in the north being developed by U.S. oil major Anadarko Petroleum Corp and Italy’s Eni.
The impoverished Indian Ocean nation, which became independent in 1975, is prominent on investors’ radar screens, with brisk annual economic growth rates of 8 percent fueled by discoveries of coal and natural gas.
But with provisional results released by polling authorities showing Frelimo and its candidate Filipe Nyusi, 55, headed for victory over Dhlakama and third-placed Daviz Simango, Renamo has called for the elections to be annulled and for a fresh vote.
Simango, 50, whose Mozambique Democratic Movement (MDM) is an emerging third political force, also denounced what he said were numerous reports of irregularities and fraud.
However, observers from the Southern African Development Community (SADC) and the African Union (AU) endorsed the elections as acceptable. SADC viewed them as “generally peaceful, transparent, free, fair and credible”, South African Foreign Minister Maite Nkoana-Mashabane said in Maputo.
The white-haired Dhlakama, 61, who has lost four previous elections to Frelimo, contested this.
“People need to understand the elections were not free, fair or transparent,” he told Reuters after meeting with ambassadors from the European Union.
With a third of the votes counted, Nyusi leads with nearly 62 percent, while Dhlakama has 31 percent and Simango has around 7 percent, according to provisional results.
The dispute over the expected Frelimo victory has raised fears of a return to conflict in the southern African nation following two years of sporadic attacks and ambushes by Dhlakama’s armed partisans in the run-up to the elections.
But while confirming he would challenge the results, including through legal channels, Dhlakama appeared to rule out armed insurgency.
“I can guarantee to you that there will be no more war in Mozambique,” he told Reuters.
Following generally peaceful voting on Wednesday, Renamo supporters later clashed with police in the second city of Beira and in Nampula in the north. At least one person suffered gunshot wounds and more than 30 arrests were made.
Renamo has accused police of intimidating voters to influence the vote outcome in favour of Frelimo and has also denounced cases of ballot stuffing. “There were people carrying around urns full of votes for Nyusi,” Dhlakama said.
Frelimo has denied the accusations.
The spokesman for Mozambique’s National Electoral Commission (CNE), Paulo Cuinica, said Renamo should direct its complaints through legal channels established for the election process. “There is no fact to suggest the process is at risk,” he said.
The European Union observer mission was more cautious than its African counterparts in its preliminary assessment of the Mozambican elections. It described Wednesday’s voting as generally quiet and orderly but said election campaigning had been “unbalanced” with Frelimo enjoying “a serious advantage”.
This included the ruling party benefitting from the use of state assets and civil servants taking part in its campaign, Judith Sargentini, head of the EU observer mission and a Dutch member of the European Parliament, told a news conference.
She said Frelimo also benefitted from a bias in the police force against the opposition and from one-sided state media.
In his interview with Reuters, Dhlakama complained that the EU and other members of the international community were not tough enough in demanding democratic standards in Africa.
“This encourages African leaders to continue to damage democracy,” he said. “It is extremely dangerous”.
He scoffed at SADC’s strong endorsement of the elections.
“What is SADC? South Africa, Zimbabwe and Angola, a club of leaders who don’t want to criticise Frelimo,” he said, a reference to the ruling former liberation movements and their leaders who dominate the politics of southern Africa.
In their campaigns, Renamo’s Dhlakama and MDM’s Simango attacked what they say is the stranglehold Frelimo has long maintained over political and economic power in Mozambique.
In the two years before the vote, Dhlakama’s armed Renamo partisans clashed sporadically with government troops and police and ambushed traffic on a north-south highway.
The former guerrilla leader emerged from a bush hideout only last month to ratify a deal with outgoing Frelimo President Armando Guebuza reaffirming a 1992 peace pact that ended Mozambique’s civil war. Guebuza was barred by the constitution from standing for a third term. (Editing by Ed Stoddard and Gareth Jones)