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Hundreds of troops and experts worked round the clock to drain Tangjiashan lake, which was formed when landslides triggered by the 8 magnitude quake on 12th May blocked the JianJiang river, in the southwest Sichuan province.
Work on a channel designed to discharge flooded water from the lake had been completed and the water was expected to start flowing from June one to three, state-run news agency quoted Yue Xi, deputy chief of water section of the People's Armed Police Force, as saying.
Office of the State Council or the cabinet said death toll in China's worst natural disaster in three decades climbed to 68,977, a rise of 119 from Friday's figure, which is the smallest single-day rise since the release of daily official toll began.
The Office said 17,974 people have still been listed as missing, while aftershocks continued to rumble across the quake-struck areas.
In the 24 hours ending this noon, 215 aftershocks were recorded in the disaster zone, China Seismological Bureau said.
Xinhua said the first group of earthquake relief workers grappling with the threat posed by the Tangjiashan lake were evacuated from the dam site and 350 others would leave today and Sunday.
It said 1,97,477 people living downstream of Tangjiashan in the main urban districts of Mianyang had been shifted to safer grounds, while two other plans require the relocation of 1.2 million people if half of the lake water volume was released or 1.3 million if the barrier fully opens.
Tan Li, Communist Party chief of Mianyang city, has ordered up to 1.3 million people in southwest China's Sichuan province to be evacuated to higher grounds, the agency said.
But the state-run China Daily, quoting Zhou Hua, spokesman for the lake relief effort said, it was a "training exercise" to test their contingency plan to move that many people... We see no reason at all to actually implement the plan at this stage".
Tangjiashan is one of the 35 "quake lakes" but the most pressing one.
Soldiers have cordoned off the streets and set up check points to prevent residents from returning home in several towns of Mianyang.
Chinese President Hu Jintao flew into the disaster zone to oversee quake relief operations in northwest China's Shaanxi province, visiting the worst-hit Hanzhong city and Ningqiang county, where he spoke to children studying in makeshift shelters.
Amidst fears of aftershocks, almost all the 340,000 locals in Ningqiang county have been asked by authorities to live outdoors, the news agency said.
The State Council said in a notice that all donations must be used only for quake relief and reconstruction of disaster-hit regions and asked local government departments to publicise information on the amount of funds allocated, the sources and
"whereabouts" of donated funds and the price and quantity of relief supplies purchased.
Source: By DDNEWS