The Government is working "around the clock" to resolve the Algerian hostage crisis in which a British national is said to have been killed, Foreign Secretary William Hague promised.

A number of Britons are among the group of foreign nationals being held after armed Islamist militants stormed a natural gas field in the eastern part of the North African country.

An Islamist group claimed it was holding 41 westerners - including seven Americans - in retaliation for the French military intervention against al Qaida-backed rebels in neighbouring Mali.

On Wednesday night, Algerian forces were reported to have been surrounding the hostage-takers and negotiating for the release of their captives, but details of what was happening on the ground were sketchy.

The Foreign Secretary said the situation was "extremely dangerous" and details could not be given out "lightly". In particular, the Foreign Office has been unable to confirm a report by the Algeria state news agency that a British national was among two people killed in the attack on the In Amenas gas facility, which is part-controlled by BP, close to the Libyan border. Six others are said to have been wounded, including two foreigners, two police officers and two security agents.

"A number of people are held hostage. This does include a number of British nationals. This is therefore an extremely dangerous situation," Mr Hague said. "We are in close touch with the Algerian government, the Algerian military have deployed to the area and the Prime Minister has spoken to the prime minister of Algeria. We are liaising very closely with all levels of the Algerian government."

He said that a rapid deployment team had been sent from the Foreign Office to reinforce British embassy and consular staff in Algeria. The Government's emergency response committee Cobra, which met yesterday, would have further meetings. "We will give more details as it becomes possible to do so but obviously it is a very dangerous situation and we cannot give out details very lightly. We will keep people informed," he said.

Mr Hague said BP was doing "a good job" keeping the loved ones and families of those involved in the incident up to date. "The safety of those involved and their co-workers is our absolute priority and we will work around the clock to resolve this crisis," he added.

Mr Hague accused the militants of "cold-blooded murder". He told the BBC: "This is an absolute tragedy of course. In this dangerous and rapidly developing situation the next of kin have been informed. The Government's Cobra emergency system is in full operation. I have spoken to our ambassador in Algeria and dispatched a rapid deployment team to Algeria to strengthen our embassy there and help them in their work.

"Excuses being used by terrorists and murderers who are involved - there is no excuse for such behaviour, whatever excuse they may claim. It is absolutely unacceptable of course. It is in this case the cold-blooded murder of people going about their business. So there is no excuse whether it be connected to Libya, Mali or anywhere else."