Fears are mounting over the fate of western hostages seized by Islamic militants amid reports that a number have been killed in an Algerian military strike.
The Foreign Office said the Algerian authorities confirmed that an operation was under way at the gas plant deep in the desert at In Amenas where the hostages were being held.
Reuters reported a local source as saying that six hostages and eight of their captors were killed in an Algerian strike on the complex close to the Libyan border.
The militants contacted a news agency in neighbouring Mauritania to claim that 35 hostages and 15 militants died when Algerian helicopters began strafing the plant - attacking the building from low-flying aircraft.
Seven hostages remain alive - including one Briton, two Americans, three Belgians, and one Japanese - said the militants. Amid conflicting reports, an Algerian official said earlier on Thursday that 20 people, including Europeans and Americans, had managed to escape the kidnappers.
BP, which part-controls the plant and has staff being held hostage, said: "We have been informed by the UK and Algerian governments that the Algerian army is attempting to take control of the In Amenas site. The situation remains unclear and we continue to seek updates from the authorities.
"Sadly, there have been some reports of casualties but we are still lacking any confirmed or reliable information. There are also reports of hostages being released or escaping."
BP said that, as a precautionary measure, a group of non-essential workers was being brought out of Algeria.
Chief executive Bob Dudley said: "Supporting these families is our priority and we are doing all we can to help during this sad and uncertain time. We are in contact with the UK and Algerian governments and will provide updates as soon as further confirmed information is available."
Britain is allowing the Algerian government to take the lead in the crisis and has received no requests for support. Downing Street said Mr Cameron had been updated on the situation by the Algerian prime minister. A spokesman said: "It remains an ongoing situation."