Sri Lanka's navy destroyed two Tamil rebel boats Friday, killing at least 20 insurgents, after the guerrillas launched an attack that triggered a fierce gunbattle in the volatile north, the military said.

A U.S. envoy, meanwhile, urged an end to fighting and a resumption of peace talks.

Navy patrol boats intercepted about 15 rebel boats off the village of Nagarkovil on the Jaffna Peninsula, setting off a battle that lasted about 90 minutes, a Defense Ministry spokesman said on condition of anonymity in line with policy.

Two boats were destroyed by naval attacks, with at least 20 insurgents believed killed, the spokesman said, adding that the other rebel boats fled.

The rebels' military spokesman Irasiah Ilanthirayan told The Associated Press that no insurgents had been killed. He said the Tigers had been conducting sea exercises when the navy interfered, triggering a gunbattle.

The pro-rebel TamilNet Website confirmed that there were heavy clashes at sea.

The attack came as Assistant Secretary of State Richard Boucher ended a two-day visit to the island, and urged the government and the rebels to end their fighting and take a step toward finding a solution when they resume talks in Switzerland starting Oct. 28.

"In the end, the fighting is not getting anybody anywhere," Boucher said in the capital, Colombo. "The only way to go in the right direction is through negotiations."

He said the Tamil Tiger leadership can only achieve its aims by returning to the negotiating table with the administration of President Mahinda Rajapakse.

"They have aspirations to satisfy some of the legitimate grievances of the Tamil community," he said. "They have aspirations to see the Tamil community respected, and be able to control its own affairs within a unified island, and the only way they're going to achieve those aspirations is through negotiation."

Meanwhile, the navy recovered the bodies of seven rebels involved in a suicide bombing that killed up to 16 people in the south, said an officer at the Media Center for National Security, speaking on condition of anonymity because he is not authorized to speak to the media.

Tamil Tigers posing as fishermen blew up two boats in a suicide attack on a naval base Wednesday in the historic resort town of Galle, killing at least one sailor. Two others reported missing were found with injuries later.

The attack in Galle, 70 miles south of Colombo, could signal a major shift for the rebels, whose decades-long campaign for a separate homeland for minority ethnic Tamils has largely focused on Sri Lanka's north and east, which they claim as their cultural heartland.

Galle, with a 400-year-old Dutch fort and beautiful beaches nearby, is popular with both local and foreign tourists.

The Tamil Tigers have been fighting since 1983 for a separate homeland for the Tamil minority, citing decades of discrimination by the majority Sinhalese. About 65,000 people were killed before the 2002 cease-fire.