Seven foreign hostages kidnapped last month by a Nigerian Islamist group from a construction firm's compound have been killed, the Italian and Greek Foreign Ministries say.

Al Qaeda-affiliated group Ansaru said it had killed the hostages seized on February 7 in the northern state of Bauchi because of attempts by Nigerian and British forces to free them.

It published grainy photos purporting to show the bodies of a Briton, an Italian, a Greek and four Lebanese workers snatched from the Lebanese firm Setraco.

Italy and Greece denied any attempt to rescue them had been made by any of the governments involved. Nigeria had no confirmation of the killings.

"Our checks conducted in co-ordination with the other countries concerned lead us to believe that the news of the killing of the hostages seized last month is true," an Italian Foreign Ministry statement said.

"There was never any military attempt to rescue the hostages by any of the governments concerned," it said, adding the president had sent his condolences to the Italian's family.

Security has become a top concern for oil and infrastructure companies across the region after gunmen loyal to al Qaeda's north African franchise stormed an Algerian gas plant in January. Up to 37 foreigners died during an attempted rescue mission by Algerian forces.

The risk posed by Islamists across west and north Africa has greatly increased since France sent troops to Mail to wrest control of its northern territory from al Qaeda linked rebels.

Islamist groups have also spread across the north and centre of Nigeria, Africa's top oil producer, where they have become the main security threat after an amnesty ended an uprising by armed groups in the oil-producing southeastern Niger Delta.

Britain said it was "likely" the Briton was killed along with the six others, with Foreign Secretary William Hague saying: "This was an act of cold-blooded murder, which I condemn in the strongest terms."

Greece confirmed its citizen was dead, adding the Foreign Ministry had informed his family. Lebanon declined to comment.

Nigerian authorities continued to say they had no evidence, after doubting the veracity of the Ansaru statement on Saturday.

"We have launched a full investigation to find out what has really happened, but for now we really cannot way whether this report is true or not," police spokesman for Bauchi state Hassan Mohammed Auyo said by telephone.

SECURITY THREAT

Western security officials say growing links between Nigerian Islamists and Saharan groups such as al Qaeda in the Islamic Maghreb has led them to increasingly seek Western targets, rather than local security forces or civilians.

French intervention in Mali has also heightened the risk to Western interests in Nigeria, analysts say, and French oil major Total moved its staff from the Nigerian capital Abuja, where the main insurgent group Boko Haram operates, in January.

Kidnappings - including some targeting foreigners - have been rife in the southeast for many years, but the gangs there usually seek a payout and hostages tend to be released quickly, while Islamist kidnappings in the north are often fatal.

The hostage-taking at the compound in the remote town of Jama'are was the largest number of foreigners seized in the mostly Muslim north since an Islamist insurgency intensified two years ago.

Ansaru declared itself a separate group from Boko Haram in January, although security officials believe them to be closely linked.

Its full name is Jama'atu Ansarul Musilimina Fi Biladis Sudan or "vanguards for the protection of Muslims in Black Africa".

Ansaru was suspected of being behind the killing of a British and Italian hostage a year ago in northwest Nigeria during a botched attempt to rescue them by British and Nigerian forces. Britain has labelled it a terrorist organisation.

It also claimed responsibility for the kidnapping in December of a French national, still missing.

Nigerian authorities are still looking for a French family of seven kidnapped in northern Cameroon and moved over the border by militants who said they were from Boko Haram.

- Reuters