But rebel leader Mujahid Dokubo-Asari on Wednesday said on-going talks with President Olusegun Obasanjo on rebel demands for autonomy were inconclusive and warned foreign oil workers to leave the region until a final deal was struck.

"We have finished the first round of talks with the president. There should be a cessation of hostilities on both sides. Apart from that, we have not agreed anything else for the time being," Asari said.

Rich in oil, the Niger Delta pumps almost all of Nigeria's output of 2.3 million barrels per day.

Rebel threat

Asari's group, called the Niger Delta People's Volunteer Force, has threatened to launch an offensive codenamed Operation Locust Feast from 1 October unless a deal is reached on autonomy and oil revenues for the Ijaw people of the delta.

The Niger Delta accounts for
almost all of Nigeria's oil output

"The ceasefire is just for the duration of the talks. Operation Locust Feast is still dependent on the outcome of the talks. Foreign nationals are still advised to leave the delta because they are part of the overall situation," the rebel leader said.

The rebels, who have been fighting sporadic battles with troops since last year, had asked foreign nationals on Monday to leave the delta before what they described as an "all-out war on the Nigerian state".

Asari had also told oil companies in the world's seventh largest exporter to shut down their oil wells.

Multinationals have largely ignored the warning, but have stepped up security in the vast area.

Oil executives were divided over how seriously to take the threats by Asari, whose following has grown rapidly in the poverty-stricken delta.

He is seen by many Ijaws as a local hero defending their right to benefit from the riches under their soil, but the government has described him as a gangster fighting for control of routes used by oil smugglers.