Mexico kills kingpin in drug war coup

GUADALAJARA, Mexico (Reuters) - Mexican soldiers shot and killed drug boss Ignacio "Nacho" Coronel on Thursday, the first major triumph this year for President Felipe Calderon's war against defiant drug cartels.

The Mexican army killed Coronel, a senior member of the powerful Sinaloa cartel, as he exchanged fire with soldiers during a raid of a wealthy residential area near Guadalajara in western Mexico, officials said.

"Nacho Coronel tried to escape, wounding military personnel ... dying as fire was returned," Edgar Villegas, a senior army official, said during a news conference in Mexico City.

Coronel was known as the "King of Ice" for his multimillion-dollar methamphetamine business and was a top lieutenant of Sinaloa leader Joaquin "Shorty" Guzman, Mexico's most wanted man.

He has been indicted in a Texas court for allegedly smuggling tonnes of narcotics into the United States and Europe since the early 1990s. The United States has offered up to $5 million for information leading to his capture.

Television images showed military helicopters flying over normally quiet streets in the upscale residential area of Zapopan as soldiers swarmed the area in search of Coronel.

The killing may provide a boost for Calderon, who has staked his presidency on winning the military campaign he launched against drug gangs in late 2006.

The conservative leader's image has been stained by spiraling violence across the country, and critics note that drug bosses operate with virtual impunity.

But drug trade experts cautioned that the Sinaloa cartel, like other drug cartels, is a sophisticated, highly organized operation and was likely to bounce back quickly.

"This is going to have a temporary impact on the methamphetamine market ... but someone else is going to take his place," said security analyst Alberto Islas.

More than 26,000 people have died in drug violence across Mexico over the past 3-1/2 years, making cartel activity in Mexico a growing worry for the administration of U.S. President Barack Obama and for some global investors and foreign tourists.

Mexican security forces shot dead top drug lord Arturo Beltran Leyva in December in Calderon's biggest blow to date in his war on drugs.

(Additional reporting by Missy Ryan and Mica Rosenberg in Mexico City and Robin Emmott in Monterrey, editing by Jackie Frank)