An undated handout picture shows the installation at Algeria’s In Amenas gas field.
Militants in Algeria say they have repelled an attack by the Algerian Army trying to rescue tens of kidnapped foreigners, among them French, British and American nationals.
The incident occurred late Wednesday when Algerian soldiers made an attempt to enter the gas installation in the country’s eastern town of In Amenas, where armed men are holding up to 41 foreigners.
The militants said they exchanged fire with Algerian soldiers, forcing them to retreat.
Earlier in the day, some 20 armed men attacked a bus carrying foreign gas workers who were about to depart via a nearby airport. The militants then attacked the compound.
One French and one British national were killed in the pre-dawn attack and six others sustained injuries.
American, English, Irish, Japanese and Norwegian nationals are among the hostages.
The militants are demanding an immediate end to France’s military intervention in neighboring Mali.
Algerian Interior Minister Daho Ould Kablia stated that the authorities "will not answer the terrorists' demands and refuse all negotiation."
The gas field in southern Algeria is jointly operated by British oil giant BP, Norway's Statoil and Algeria's Sonatrach.