The Philippine government has offered a 500,000 peso ($10,256) reward for information leading to the location of the remaining Red Cross worker currently held hostage in the south of the country.

Eugenio Vagni, an Italian national who is being held by members of the Abu Sayyaf group on Jolo island, has been transferred by the group to another unit.

"We have now received reports that Mr Vagni was left by his captors to another group, but they are now staying in one area," General Jesus Verzosa, Philippine National Police chief, said on Thursday.

"They can no longer move the hostage due to his deteriorating condition."

Naval blockade

Government forces clashed on Wednesday with those holding Vagni as they tried to escape from a jungle area in Jolo, Brigadier General Gaudencio Pangilinan, a military spokesman told reporters in the capital Manila.

"It was a big group, about 50 of them," Pangilinan said, adding that they were carrying firearms, including rocket launchers.

Troops have set up naval blockades near Jolo's coastal villages to prevent the Abu Sayyaf from escaping by sea, Ronaldo Puno, the interior secretary, said. 

Vagni was abducted along with Andreas Notter of Switzerland and Mary Jean Lacaba of the Philippines in mid-January while on a humanitarian mission in the area. They all work for the International Committee of the Red Cross (ICRC).

Lacaba was freed on April 2 while Notter was safely recovered by authorities on April 18.

There have been mounting fears that the increasingly desperate Abu Sayyaf may try to harm Vagni as they evade troops.