Algerian forces have surrounded a natural gas complex deep in the Sahara Desert where Islamic militants took dozens of foreigners hostage Wednesday.
The militants say they seized the foreigners in retaliation for France's military intervention in Mali. French troops and warplanes have been trying to push back Islamists linked to al-Qaida who control the northern part of the landlocked African nation.
Ain Amenas, Algeria
The group of hostages - up to 41 people, according to reports from the scene - include at least seven Americans, plus Britons, French, Japanese and Norwegian nationals. Well over 100 Algerians also were seized when the militants attacked at dawn, crossing the desert in four-wheel-drive vehicles. The Algerian captives were released later in small groups, however.
Algerian officials said the militants were surrounded by government troops as night fell, with no obvious way to escape from the energy complex with their captives, but those accounts were impossible to verify. Algeria's interior minister, Dahou Ould Kablia, said his country will not negotiate with terrorists.
The attackers are believed to have killed at least two people, possibly more, including one British national. Six other foreigners were believed wounded.
U.S. Defense Secretary Leon Panetta said the kidnappings were an act of terrorism, and the United States will take all "necessary and proper steps" to deal with the situation.
The kidnappers' exact affiliations are not clear, but a member of the group al-Qaida in the Islamic Maghreb (AQIM) spoke on their behalf to VOA Wednesday. He said the U.S. must "face the consequences" if it gives any assistance to the French military effort that began in Mali earlier this month.
The United States listed the AQIM group as a terrorist organization more than 10 years ago.
The spokesman for the Islamic Maghreb group said France has declared "war" on Islamists in northern Mali, and he vowed that Westerners would be harmed if the intervention continues.
In Washington, the State Department said Secretary of State Hillary Clinton contacted Algeria's Prime Minister Abdelmalek Sellal.
French forces entered Mali last week to help drive back Islamist militants moving towards the capital. At least three al-Qaida-linked groups are among those who seized control of northern Mali last year.
Algeria had long warned against military intervention against the rebels in northern Mali, fearing the violence could spill over its own long and porous border.