NOUAKCHOTT: The Algerian military launched on Thursday an air and ground assault on a desert gas complex where militants were still holding an unknown number of hostages, one of the kidnappers told the ANI news agency.

“Warplanes and ground units have begun an operation to take the complex by force,” the spokesman said, threatening to “kill all the hostages if the Algerian forces succeed in entering the complex.”

Earlier, Algeria's APS news agency said the army had freed four foreigners, two Britons, a Frenchman and a Kenyan, and 600 Algerian workers being held at the In Amenas plant, in southeastern Algeria.

The report, citing local sources, said an unspecified number of people were killed in the rescue operation, after the kidnapper's spokesman claimed an army air strike killed 34 hostages and 15 militants.

The head of a French catering company had said 150 of its Algerian employees were being held at the remote gas plant, jointly operated by British oil giant BP, Norway's Statoil and Algeria's Sonatrach, near the Libyan border.

The heavily armed militants launched their attack on Wednesday morning, killing two people, including one Briton. They also took scores of Algerians and 41 foreigners hostage, among them American, British, French, Irish, Norwegian and Japanese citizens.

A foreign diplomat in Algiers said the rescue mission “did not go too well for the hostages,” adding that the army operations were ongoing late afternoon.

Earlier on Thursday, APS said some 30 Algerian workers managed to escape from their captors. Private TV channel Ennahar said 15 foreigners, including a French couple, had also escaped.

The Irish foreign ministry said an Irish passport holder from Belfast was free and in good health.

The gunmen said the attack was in retaliation for Algeria supporting French airstrikes in Mali and demanded the release of militants in exchange for the hostages, calling on the army to pull out of the area to allow negotiations to begin.

Algerian Interior Minister Dahou Ould Kablia insisted on Wednesday that Algiers would not negotiate with the “terrorists.”

A spokesman from British Prime Minister David Cameron said he would have preferred to have been informed in advance of the army's assault, but was instead contacted by his Algerian counterpart at 1130 GMT, after it had begun.