Iraq group says it has killed second US hostage

7.30am - By LUKE BAKER

BAGHDAD - Militants killed a second American captive in Iraq after a 24-hour deadline passed on Tuesday, a web site statement and Arab television said.

There was no immediate word of the fate of a Briton also being held by the Tawhid and Jihad group which on Monday said it had beheaded the first of three contractors seized last week.

The group, led by al Qaeda ally Abu Musab al-Zarqawi, said on Monday in video footage of American Eugene Armstrong's killing that it would behead the other two within a day unless women inmates were freed from Abu Ghraib and Umm Qasr jails.

Al Jazeera television said a statement announcing the killing of fellow American Jack Hensley, 48, was on the internet. On one Islamist site, a contributor who has in the past posted messages in the name of the group said he was dead.

"The sons of our nation have slit the throat of the second American hostage after the deadline passed and we will provide you with pictures soon," said the contributor, who goes by the pseudonym Abu Maysarah al-Iraqi.

The US State Department could not confirm the killing.

President George W Bush has said Washington will not negotiate, and at the United Nations on Tuesday he vowed not to retreat against an insurgency he said was likely to bring increased violence in coming months.

The US military says there are no women in either of the named prisons, and only two women in US detention in Iraq.

The high-profile two, nicknamed "Mrs Anthrax" and "Dr Germ", are accused of working on Saddam Hussein's weapons programmes and are held at a secret high-security camp.

Before the report of Hensley's death, the family of British hostage Kenneth Bigley, 62, urged the prime minister to have the two women freed, though there was no confirmation from the kidnappers that this was specifically what they were seeking.

"I ask Tony Blair personally to consider the amount of bloodshed already suffered," Bigley's son Craig said. "Only you can save him now ... please meet the demands and release my father -- two women for two men."

A spokesman for Blair said: "We are following the situation very closely and the government is doing all that it can."

The militants' first video footage released on Monday showed Armstrong, 52, sitting blindfolded on the floor in an orange jumpsuit, black-clad and hooded gunmen standing behind him.

One militant read a statement and attacked the hostage's neck with a knife. Further close-ups showed the head being sawn off. CIA said it believed Zarqawi -- Washington's number one enemy in Iraq -- was the man delivering the statement.

Armstrong, Hensley and Bigley were seized by gunmen from the house they shared in Baghdad on Thursday.

In a speech with election-year overtones before sceptical world leaders at the United Nations annual general assembly, Bush made no apologies about going to war against Iraq in 2003 without UN Security Council backing.

"The work ahead is demanding. But these difficulties will not shake our conviction that the future of Afghanistan and Iraq is a future of liberty. The proper response to difficulty is not to retreat -- it is to prevail," he added, to no more than polite applause. Bush faces re-election in November.

The United States has offered US$25 million for information leading to Zarqawi's death or capture, and has launched a series of air strikes on the rebel-held city of Falluja, west of Baghdad, targeting suspected hideouts used by his followers.

Jordanian-born Zarqawi's group has claimed responsibility for most of the bloodiest suicide attacks since Saddam's overthrow, and beheaded US telecoms engineer Nicholas Berg in May and South Korean driver Kim Sun-il in June.

The statement read out on the video of Armstrong's killing ridiculed Bush and promised Iraqi women their honour would be protected.

"Oh, you Christian dog Bush, stop your arrogance ... the mujahideen will give America a taste of the degradation you have inflicted on the Iraqi people," the statement said.

More than a dozen hostages are being held in Iraq and are threatened with death unless their captors' demands are met.

Two French journalists were seized a month ago, and two female Italian aid workers were kidnapped earlier this month.

Another guerrilla group has threatened to kill 10 Turkish workers unless their company stops doing business in Iraq. The firm said on Tuesday it would do so.

Iraqi police said they found the body of a Turkish driver who had been shot several times, but Turkish media said militants released another truck driver kidnapped six weeks ago.

The US military said two US marines died in fighting in Anbar province west of Baghdad, which includes Falluja.

US officials said the Bush administration had begun tapping its US$25 billion emergency fund for the Iraq war to prepare for a major troop rotation and intense fighting this autumn, after earlier insisting it had enough money.

Already the Pentagon has used more than US$2 billion of the fund. The money is being used to ramp up production of armoured vehicles to support the troop rotation, as well as to buy body armour and bolster fuel supplies, the officials told Reuters.

UN Secretary-General Kofi Annan, speaking before Bush, denounced an insurgency where civilians are massacred and relief workers, journalists and others "are taken hostage and put to death in the most barbarous fashion".

- REUTERS

Herald Feature: Iraq