"This morning they called us to tell us that they had buried him. Some of our young people followed the indications that the kidnappers had given to reach the site," the Catholic news agency SIR quoted Warduni as saying.
"They dug there and found the bishop lifeless. We still don't know if he died of causes linked to his precarious health or if he was killed. The kidnappers only told us that he was dead."
Local media reported that his body was found decapitated in the Intisaar district east of Mosul.
The Vatican said Pope Benedict XVI was immediately informed and was "profoundly moved and saddened" by the news.
Chaldeans belong to a branch of the Roman Catholic Church and form the biggest Christian community in Iraq.
Last year's International Religious Freedom Report from the US state department found that the Chaldean Catholic population comprised less than one million people in the predominantly Muslim country.
Reverend Federico Lombardi, a spokesman for the Vatican, issued a statement after news of the death, saying: "Unfortunately the most absurd and unjustified violence continues to strike the Iraqi people and particularly the small Christian community.
|"Unfortunately the most absurd and unjustified violence continues to strike the Iraqi people and particularly the small Christian community"|
Reverend Federico Lombardi,
"Our hope is that this tragic event will underscore and reinforce everybody's commitment, and particularly that of the international community, to bring peace to this troubled country."
Churches, priests and businesses owned by Christians have been attacked repeatedly since the US-led invasion of Iraq in 2003, and many have fled the country.
The US military regards Mosul as a stronghold for al-Qaeda in Iraq and is engaged in a campaign with Iraqi forces to root out fighters from that area.
In an interview with AsiaNews, a Vatican-affiliated missionary news agency, last November, Rahho said that the situation in Mosul was not improving and "religious persecution is more noticeable than elsewhere because the city is split along religious lines".
"Everyone is suffering from this war irrespective of religious affiliation, but in Mosul Christians face starker choices," he said.
In a separate development, up to 18 people were killed and at least 49 others wounded in the Bab al-Sharji area of central Baghdad by a suicide car bomb, police said.
Iraqi police and soldiers were searching the area for another possible attacker who accompanied the bomber.
Armed men also shot dead Qassim Abdul-Hussein of al-Muwatin newspaper in Baghadad, according to the Iraqi journalists' syndicate.
North of the capital, near the city of Baiji, two people were killed and another two injured when armed men attacked a patrol of US-back neighbourhood security forces, police said.
An Iraqi soldier was killed by a suicide car blast near in an attack on a security checkpoint near the city of Kirkuk, injuring 10 others.
Overnight, US soldiers and al-Mahdi Army fighters exchanged rocket and mortar fire in the southern city of Kut.
In response, a senior aid to Muqtada al-Sadr, leader of al-Mahdi Army, on Thursday ordered the fighters to observe a seven-month old ceasfire.
Luwaa Sumaisem, al-Sadr's aide, said: "We call on them to calm down and to cease fire and to stop shedding the blood of Iraqis. This is the opinion of Sadr, whether it is in Kut or any other Iraqi provinces."