UPDATE: Algerian special forces launched a rescue operation Thursday at a natural gas plant in the Sahara Desert and freed foreign hostages held by al-Qaida-linked militants, but estimates for the number of dead varied wildly from four to dozens.
Militants claiming revenge for France's intervention against rebels in Mali seized the Ain Amenas natural gas complex on Wednesday, taking dozens of foreign workers hostage.
Algerian state television said Thursday that four captives, two Britons and two Filipinos, had died. But the militants said at least 35 hostages had died in the state's rescue attempt. There was no way to independently verify the toll in the remote location, 800 miles (1,300 kilometers) from Algiers.
The reports of high casualties have deeply disturbed foreign governments, prompting a number to criticize Algeria's operation. Britain's Foreign Office attempted to prepare the British public by saying, "We should be under no illusion that there will be some bad and distressing news to follow from this terrorist attack."
Oil prices rose $1.08 on the news to $95.32 on the New York Mercantile Exchange and prompted energy companies like BP PLC and Spain's Compania Espanola de Petroleos SA to try to relocate energy workers at other Algerian plants.
The Algerian government said it was forced to intervene due to the militants' stubbornness and their desire to escape with the hostages.
"An important number of hostages were freed and an important number of terrorists were eliminated, and we regret the few dead and wounded," Algerian Communications Minister Mohand Said Oubelaid told national media, adding that the "terrorists are multinational," coming from several different countries with the goal of "destabilizing Algeria, embroiling it in the Mali conflict and damaging its natural gas infrastructure."
Islamists from the Masked Brigade, a Mali-based al-Qaida offshoot, who have been speaking through a Mauritanian news outlet, said Algerian helicopters opened fire as the militants tried to leave the vast energy complex with their hostages. They claimed that 35 hostages and 15 militants died in the attack and only seven hostages survived.
Algeria's official news service, meanwhile, earlier claimed that 600 local workers were freed in the raid and half of the foreigners being held were rescued. Many of those locals were reportedly released on Wednesday, however, by the militants themselves.
One Irish hostage was confirmed safe: supervising electrician Stephen McFaul, whose mother said he would not be returning to Algeria.
"He phoned me at 9 o'clock to say al-Qaida were holding him, kidnapped, and to contact the Irish government, for they wanted publicity. Nightmare, so it was. Never want to do it again. He'll not be back! He'll take a job here in Belfast like the rest of us," said his mother, Marie.
Dylan, McFaul's 13-year-old son, started crying as he talked to Ulster Television. "I feel over the moon, just really excited. I just can't wait for him to get home," he said.
In Washington, White House Press Secretary Jay Carney said the Obama administration was "concerned about reports of loss of life and are seeking clarity from the government of Algeria."
Japan's Prime Minister Shinzo Abe protested the military raid as an act that "threatened the lives of the hostages," according to a spokesman.
Jean-Christophe Gray, a spokesman for British Prime Minister David Cameron, said Britain was not informed in advance of the raid but described the situation as "very grave and serious." French President Francois Hollande called it a "dramatic" situation involving dozens of hostages.
Norwegian Prime Minister Jens Stoltenberg would not criticize the Algerian operation but said he wished the Norwegian government would have been notified before it started. He added that while Algeria has declined medical help, Norway will send a plane with medical equipment and personnel.
An unarmed American surveillance drone soared overhead as the Algerian forces closed in, U.S. officials said. The U.S. offered military assistance Wednesday to help rescue the hostages - whose numbers varied wildly from dozens to hundreds - but the Algerian government refused, a U.S. official said in Washington. He spoke on condition of anonymity because he was not authorized to speak publicly about the offer.
Algerian forces who had ringed the Ain Amenas complex in a tense standoff had vowed not to negotiate with the kidnappers, who reportedly were seeking safe passage. Security experts said the end of the two-day standoff was in keeping with the North African country's tough approach to terrorism.
"I would not be surprised if the death toll was has high as the militants put it, it's a well-known fact that the Algerians never had problems causing a blood bath to respond to terrorist attacks," said Riccardo Fabiani, North Africa analyst for the Eurasia group, who expressed doubt over Algeria's claims that mediation was abandoned in the face of the kidnappers' intransigence. "I wonder whether really in 24 hours you can establish some kind of negotiations with terrorists, I don't think they really tried."
The kidnapping is one of the largest ever attempted by a militant group in North Africa. The militants phoned a Mauritanian news outlet to demand that France end its intervention in neighboring Mali to ensure the safety of the hostages in the isolated plant, located 800 miles (1,300 kilometers) south of the capital of Algiers.
Phone contacts with the militants were severed as government forces closed in, according to the Mauritanian agency, which often carries reports from al-Qaida-linked extremist groups in North Africa.
A 58-year-old Norwegian engineer who made it to the safety of a nearby Algerian military camp told his wife how militants attacked a bus Wednesday before being fended off by a military escort.
"Bullets were flying over their heads as they hid on the floor of the bus," Vigdis Sletten told The Associated Press in a phone interview from her home in Bokn, on Norway's west coast.
Her husband and the other bus passengers climbed out of a window and were transported to a nearby military camp, she said.
"He is among the lucky ones, and he has confirmed he is not injured," she said, declining to give his name for security reasons.
It was then that the militants went after the living quarters of the plant instead of disappearing back into the desert.
Information about the 41 foreign hostages the militants claimed to have - which allegedly included seven Americans - was scarce and conflicting. All were reportedly workers at the plant.
A spokesman for the Masked Brigade told the Nouakchott Information Agency in Mauritania that the seven surviving hostages included three Belgians, two Americans, a Briton and a Japanese citizen.
Earlier in the day before the raid, an Algerian security official said that 20 foreign hostages had escaped. He did not return phone calls after the raid.
The Norwegian energy company Statoil had said three Algerian employees who had been held hostage were safe but the fate of nine Norwegian workers was unclear. Japanese media reported at least 3 Japanese citizens among the hostages and Malaysia confirmed two.
Algerian Interior Minister Daho Ould Kabila said the roughly 20 well-armed gunmen operating under orders from Moktar Belmoktar, al-Qaida's strongman in the Sahara, who is now based in Mali.
It is certainly the largest haul of hostages since 2003, when the radical group that later evolved into al-Qaida in North Africa snatched 32 Western tourists in southern Algeria. This is also the first time Americans have been involved.
BP, the Norwegian company Statoil and the Algerian state oil company Sonatrach, operate the gas field and a Japanese company, JGC Corp, provides services for the facility.
Mali and al-Qaida specialist Mathieu Guidere said Algeria's refusal to accept help was also normal.
"They never accept any military help," he said. "They want to do it their way."
UPDATE: Algeria's state news agency says that special forces have completed their operation to free hostages from a remote desert natural gas complex.
The report gave no new toll for the number of dead among either the hostages or the kidnappers, who were described as a "multinational terrorist" group.
Earlier Algerian TV had said that four foreign workers, two Britons and two Filipinos, died in the operation.
Earlier on Thursday, the militants themselves said that dozens had died in the assault.
UPDATE: A raid by Algerian forces -- in an apparent effort to re-take a gas plant in the Sahara Desert that had been captured by Islamist militants -- may have resulted in the deaths of most of the hostages they were holding.
The militants claim that 35 hostages and 15 militants were killed after Algerian military helicopters strafed the area. They say seven hostages survived, including two Americans.
A U.S. official says the Obama administration had offered military assistance to rescue the hostages, but that the Algerian government refused the help.
Algeria's news agency, citing local police, said four foreign hostages were freed in the operation. Earlier, an Algerian security official had said that 20 foreign hostages had escaped before the raid.
Irish officials say an Irish hostage has made contact with his family, and is safe and free.
Algerian forces had surrounded the complex in a tense standoff since the plant was seized, and had vowed not to negotiate with the kidnappers.
WASHINGTON (AP) - The White House is condemning the taking of dozens of hostages, including several Americans, from an oil plant in Algeria by militants linked to rebel Islamists in Mali.
Militants claim that 35 hostages were killed Thursday, after Algerian military helicopters strafed the area during an attempt to free those being held. They say seven hostages survived.
White House press secretary Jay Carney won't confirm the status of the Americans or whether the U.S. offered to help the Algerian government with its raid on the energy complex.
Carney says the administration is monitoring the situation closely, is concerned about reports of killings and is in contact with the Algerian government.
(Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)