First... a 7/8" 5-shot group at 300 yards is 0.2785 MOA, which is a super-impressive group. When you say you're not getting 7/8" groups anymore... what ARE you getting? What kind of groups are you achieving on a REGULAR basis at this point?
That said... 1200 rounds is nothing for a 6.5CM barrel. My original factory barrel passed the 3500 round mark last weekend. Granted this was at only 100 yards, and I wasn't trying super hard.... 0.6 MOA 5-shot group.
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7 weeks ago at 300 yards. Barrel was over 3,000 rounds at this point. Those pesky 5th shot fliers! But, still pretty good, I'd say. They're not 0.278-MOA groups like your 7/8" 5-shot group at 300. But, any time I'm sub-MOA at 300 yards or farther, I'm a happy camper. BTW, I only shoot factory ammo.
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I cannot imagine you've burned out your barrel at 1200 rounds.