Algerian special forces were continuing to hunt Islamist militants on Friday night who overran a BP gas plant, as freed British hostages spoke of their fears for their colleagues still trapped on the site.
The Algerian state news agency APS reported that about 100 foreign workers had been released from a total of 132 seized by the militants when they stormed the remote desert facility on Wednesday.
At least 10 UK nationals were understood to still be "at risk" at the plant at In Amenas, close to the Libyan border, as the hostage crisis headed towards a fourth day.
The Algerian government said that an unspecified number of foreigners had died during the military rescue operation, which began on Wednesday morning.
Eighteen of the militants were also reported to have been killed - suggesting that around a dozen of the original group of about 30 could still be at large.
A Mauritanian news site reported that the remaining militants were demanding the release of two terrorists held in the United States, including 1993 World Trade Centre bombing mastermind Omar Abdel Rahman, in return for the release of two US captives.
APS said the unconfirmed figures also put at 573 the number of Algerians "freed" by special forces, and efforts to force out the militants were going on.
It quoted a security source as saying they were still trying to find a "peaceful end".
Despite the casualties among the hostages, an Algerian government source quoted by APS strongly defended the military operation, saying it had prevented a "true disaster" which would have caused "immeasurable" human and material damage.
The rescue mission had been carried out in "extremely complex circumstances" against terrorists armed with a huge arsenal of missiles, rocket launchers, grenades, and assault rifles, the source said.
Swift action, the source added, was the "only way to minimise or neutralise the deadly intent of the multinational terrorists - but not without the inevitable risks in all such situations".
Prime Minister David Cameron said Britain would do "everything we can to hunt down" those behind the "brutal and savage" attack.
But he publicly expressed his frustration that he had not been notified in advance of the special forces assault.
He said that he had offered UK "technical and intelligence support" - including from experts in hostage negotiation and rescue - but that it was not taken up.
It was reported that two UK workers were among the casualties, which would bring the British death toll to three after one was killed in Wednesday's initial raid by the militants.
The foreign hostages are from eight different countries and many Algerians are held captive.
Footage of several British workers said to have escaped the siege has been shown on Algerian state television. One man praised the Algerian security forces.
"The gendarmes did a fantastic job. They kept us all nice and safe and fought off the bad guys. I never really felt in any danger, to be honest," he said.
Another expressed concern for colleagues still trapped in the plant.
"I feel safe at the moment but I won't feel 100% happy until I'm back in the UK," he said.
"My heart goes out to the guys that are still there and hopefully everyone comes home safe because, at the end of the day, it's only work."
The Foreign Office has sent a plane carrying consular crisis staff to within 280 miles of the facility amid continued efforts by joint operator BP and the Government to evacuate UK workers.
Mr Cameron, who cancelled a trip to the Netherlands to make his long-awaited speech on the EU so he could remain in the UK to oversee the crisis, chaired two meetings of the Government's Cobra emergencies committee.
In a statement to a sombre House of Commons he said the number of British citizens believed killed, injured or missing had been "quite significantly reduced" since overnight reports that had they numbered around 30.
Other reports put the number at 10 and it is believed that is much closer to the true picture but fuller details are being held back for fear of aiding the terrorists.
Mr Cameron was told of the military raid only after it was under way when he telephoned Algerian prime minister Abdelmalek Sellal yesterday morning, to the dismay of No 10.
He told MPs that he would not hide the fact that he was "disappointed not to be informed in advance" and the UK had offered to help "in any way we can".
"They were facing the situation where there was imminent threat to life and we should bear that in mind," he added, describing the contacts as "good".
Mr Cameron also stressed the need to combat the growing threat of terrorism in the Sahel region from groups such as al Qaida in the Islamic Maghreb.
"We do face a large existential threat from groups of terrorists. They thrive in ungoverned spaces," he told MPs. "The threat posed by AQM is made worse when we have so much ungoverned space in Mali. The threat will grow."
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