MAPUTO: Islamist militants seized control of a town in northern Mozambique, killing several people including at least one foreign worker, near a huge gas project involving France's Total and other energy companies, security sources said on Saturday. Militants raided the town of Palma in the northern province of Cabo Delgado on Wednesday, forcing nearly 200 people including foreign gas workers to be evacuated from a hotel where they had sought refuge. Some people were killed, including a South African, in an ambush during the rescue operation led by the military, security sources and some surviving workers said, though details were not immediately available on their numbers or nationalities.

Local media reported at least seven workers were killed during the ambush.

The government has not given an update of the attack since Thursday.

The militant attack on Palma was the closest yet to the gas project in a three-year Islamist insurgency across Mozambique's north.

"Government forces have withdrawn from Palma so the town has been taken," one security source said. Another source confirmed militants had taken the town though fighting in the area was ongoing.

Palma is about 10 kilometres from the liquified natural gas project located on the Afungi peninsula on the Indian Ocean coast near the Tanzania border.

Jihadist militants staged the surprise raid, sending terrified residents into nearby forests, while gas and government workers sought shelter at the Amarula Palma hotel.

The defense ministry spokesman Omar Saranga urged people to "remain calm and follow the rescue instructions given by the authorities".