WRAPUP 1-Syria denies Assad's deputy tried to defect

* Assad's forces bombard Aleppo, storm town in oil-producing

east

* New Syria envoy Brahimi: need to clarify UN support for

mission

* Assad's deputy Shara "welcomes Brahimi appointment"

* U.N. to maintain "liaison office" in Damascus

BEIRUT, Aug 19 (Reuters) - Syria dismissed reports that

President Bashar al-Assad's deputy had defected and its forces

pursued an offensive against rebels, bombarding parts of Aleppo

in the north and attacking an insurgent-held town in the

oil-producing east.

Vice-President Farouq al-Shara "never thought for a moment

about leaving the country", said a statement from his office

broadcast on state television on Saturday in response to reports

that the veteran Baath Party loyalist had tried to defect to

Jordan.

Assad, battling a 17-month-old rebellion led by Syria's

Sunni Muslim majority, has been abandoned by a number of senior

officials, including prime minister Riyadh Hijab two weeks ago.

Shara, whose cousin - an intelligence officer - announced

his own defection on Thursday, is a Sunni Muslim from Deraa

province where the revolt began against Assad, a member of the

minority Alawite sect that is an offshoot of Shi'ite Islam.

The 73-year-old former foreign minister kept a low profile

as the rebellion mushroomed but appeared in public last month at

a state funeral for three of Assad's top security officials

killed in a bomb attack in Damascus.

The statement said he had worked since the start of the

uprising to find a peaceful, political solution and welcomed the

appointment of Algerian diplomat Lakhdar Brahimi as a new

international mediator for Syria.

Brahimi, who hesitated for days before accepting a job that

France's U.N. envoy Gerard Araud called an "impossible mission",

will replace former U.N. Secretary-General Kofi Annan, who is

leaving at the end of the month.

Annan's six-point plan to stop the violence and advance

towards political negotiations was based on an April ceasefire

agreement which never took hold. The conflict has deepened since

then with both sides stepping up attacks.

Assad's forces have resorted increasingly to air power to

hold back lightly armed insurgents in the capital Damascus and

Aleppo, a northern commercial hub. More than 18,000 people have

died in the bloodshed and about 170,000 have fled the country,

according to the United Nations.

The Syrian Observatory for Human Rights said the army

bombarded neighbourhoods in Aleppo. Rebels hold several

districts in the country's largest city and have tried to push

back an army counter-offensive.

State television said soldiers "cleared terrorists and

mercenaries" - terms used by authorities to describe Assad's

armed opponents - from the western district of Saif al-Dawla,

where some of the heaviest fighting has taken place.

Internet footage which activists said was filmed in Saif

al-Dawla on Saturday showed a plane making a low pass over

buildings and dropping two bombs.

The Observatory also said at least 20 armoured vehicles

moved into the eastern town of Mayadeen in Deir al-Zor province,

where Syria's 200,000 barrels per day of oil are produced.

More than 130 people were killed in Syria on Saturday, it

said, including 15 in Deir al-Zor.

In the town of Tel, north of Damascus, local activists said

the bodies of 40 people killed by bombardment were gathered

together for a joint burial. A picture showed what appeared to

be several corpses wrapped in colourful blankets on a street.

OBSERVERS SET TO LEAVE

Brahimi will have a new title, Joint Special Representative

for Syria. Diplomats said this was to distance him from Annan,

who complained that his peaceful transition plan was crippled by

divisions between Western powers - who want Assad out - and

Russia, his most important ally - in the U.N. Security Council.

Describing the situation in Syria as "absolutely terrible",

Brahimi told Reuters he urgently needed to clarify what support

the United Nations can give him and said it was too soon to say

whether Assad should step down - in contrast to Annan who said

it was clear the Syrian leader "must leave office".

The last U.N. observers who deployed in Syria four months

ago to monitor Annan's failed ceasefire will leave after

midnight on Sunday, when their mandate expires.

They will leave a "liaison office" open in Damascus after

their departure, though its size and role have not been

finalised, a U.N. spokeswoman said.