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Witnesses are beginning to describe scenes of devastation after a huge earthquake triggered a tsunami in the Solomon Islands, killing at least 12 people and triggering panic as homes were sucked into the sea.

A spokeswoman for Solomon Islands Prime Minister Manasseh Sogavare said the death toll included two children, and was expected to rise.

Geological agencies in Japan and Australia put the magnitude of the quake at 8.1, while the US Geological Survey's (USGS) revised its earlier 7.6 estimate to 8.0.

The quake was 10 kilometres deep and struck 45km south south-east of Gizo, a small township on New Georgia Islands, at 8.39am (NZT).

The initial tremor was followed around seven minutes later by a second one, centred further west, of magnitude 6.7, USGS said.

At least seven people died in Gizo, many trapped in their homes when waves swept through the town. Other bodies could be seen but not reached because of big waves, the government said in a statement.

"The wave was up to 10 metres high in some villages," Solomon Islands' chief government spokesman Alfred Maesulia said. "Some villages have been entirely washed away."

Gizo hospital worker Ian Maneatu Laska said the town's hospital was closed in light of the destruction and people were seeking refuge on higher ground.

"There are still missing people whose bodies were seen floating at sea this afternoon.

"Local rescue groups were unable to retrieve them as huge waves prevented rescue efforts," he said.

"Water is slowly reducing but people are still gripped with fear at the moment."

Mr Laska said most of the victims were trapped in their homes when waves crashed into the township.

Dive shop owner and provincial politician on Gizo Danny Kennedy also said some villages had been entirely destroyed.

"It was just like a real extreme tide ... the water just came up about probably about four to five metres above sea level and kind of just went up into the communities and doused everything," he said.

"There are quite large boats sitting in the middle of the road. Many of the houses that were on stilts are sitting on the ground. A number of the coastal communities have been completely wiped out."

Solomons' disaster management authorities said communications problems were preventing an assessment of damage on Simbo island where residents reported waves hitting houses 200 metres inland.

Ramsi assistance

The Australian-led Regional Assistance Mission to the Solomon Islands (Ramsi) has despatched aircraft to determine the scale of the damage.

The multinational force, which includes 43 New Zealanders, has sent a helicopter and a plane to the worst hit area in the country's west.

Ramsi has also offered aircraft, boats and personnel to the Solomon Islands Police Force (SIPF), which is leading the response to the disaster, an SIPF media spokesman said.

"We believe there's been a number of villages very severely damaged and even washed away. But we don't know the exact number," the spokesman said.

Asked about the report of an entire island being overswept by the tsunami, he said: "That is correct. It was several metres underwater."

The spokesman said there were unconfirmed reports of four deaths, including a 12-year-old girl, and adult woman and two elderly men.

Communication links have been all but wiped out, with police stations on two islands among the scores of buildings inundated or swept away by the massive wall of water.

"They (Ramsi) have despatched a helicopter and a fixed-wing aircraft and those aircraft have observers on board to do an assessment of the damage," the police spokesman said.

"They are carrying an amount of emergency provisions and emergency medical equipment.

"Their first priority will be to establish a ... communications link, After that they will be conducting flights to do the assessment."

"The Taro (Island) and Lofung police stations both went under water. There's been substantial damage to (the Western Provincial capital) Gizo township."

The spokesman said it was impossible to say yet how many islands had been hit.

"There's 492 islands in the Solomons and up in that area there are several hundred islands," he said.

The spokesman said Ramsi had people stationed in the Western Province but all had been accounted for.

Choiseul Island

In a statement, the premier of Choiseul Province, also in the west, said two people were confirmed dead and several others were missing in Sasamunga village on Choiseul island.

Jackson Kiloe said Sasamunga had lost its hospital in the disaster and health centres and schools in surrounding villages were also devastated.

"We are now in disaster and we are calling on the government to help us at this hour of need," Kiloe said.

Earlier, he described the "strangely frightening" behaviour of the sea as it was sucked away before the tsunami rolled in.

Parts of the coastal sea bed were left dry and exposed as the water was pulled out before the wall of water rushed ashore.

"The huge wave rolls are stronger than floods," he said by phone from Taro Island.

"They are causing large areas of ocean to dry up exposing fish and other marine life."

Ada Akao from Australia's High Commission in Honiara said the quake was also felt in Honiara, the capital of the Solomon Islands, but no buildings in the city appeared to have been damaged.

"It lasted ... let's say two minutes. Not much damage here. We felt a gentle rock. Nothing bad happened," Akao said.

Regional warnings

The Australian government said the tsunami also hit the western Papua New Guinea island of Bougainville.

The earthquake triggered a Pacific-wide tsunami alert, which was lifted nine hours later.

The Pacific Tsunami Warning Centre issued warnings for Papua New Guinea, Vanuatu, Nauru, New Caledonia, Chuuk, Pohnpei, Kosrae, Australia, Indonesia, Tuvalu, Kiribati and Marshall Islands.

In Australia, Bondi Beach in Sydney was closed and all Manly ferry services suspended after a warning that a tsunami of 20- 30cm could hit the coast.

However a Geoscience spokeswoman said it would pose little threat: "It's not a really big (threat) for the coast of Australia," she said.

New Zealand's Ministry of Defence also warned of possible changes in sea level of up to 0.5m between 1.38pm and 5.06pm.

But it said the earthquake was unlikely to have caused a tsunami that would have a significant impact on New Zealand.

Geoscience duty seismologist David Jepsen said the quake had occurred in an area of frequent seismic activity.

There had already been one aftershock, the strength of which had not yet been determined, Dr Jepsen said.

"It's on the plate boundary between the Pacific and Asian plates, so these quakes are common," he said.

The disaster is not expected to disturb plans to this week withdraw 40 New Zealand soldiers serving with Ramsi.

The troops are on a normal rotational assignment and their replacements, among them 30 territorial force personnel, arrived in Honiara, the Solomons capital, last week.

Defence Force spokesman Dave Courtney said the group, which has been serving with the Ramsi for the past four months, was still due to fly home on Wednesday as planned.

He said the New Zealanders were due to meet local officials tonight to discuss the extent of damage in outlying areas of the Solomons affected by the quake and tidal waves.