"We have identified the area where they are held. I can't disclose the place," Mohammed Ali al-Mussawi, chief of operations at the police headquarters of Basra, the southern Iraqi city, said.
On Thursday militiamen disguised as police officers seized the five Westerners -- four US citizens and an Austrian -- as they guarded a convoy of trucks from Kuwait that was stopped at a police checkpoint near Safwan, near the Kuwaiti border.
Earlier on Saturday Mussawi said all the five hostages are "still held captive" with none of them found dead or rescued as reported earlier.
On Friday a Basra provincial official said that two American hostages had been rescued in a police raid and that one was found dead.
"Iraqi police found the body of an American where they conducted a raid in which two other Americans were freed," the official said.
Their employer, the Kuwait-based Crescent Security Group, said it was unaware of the fate of the Westerners.
"We have not received confirmation from the coalition forces that the two people released or the one killed are with our company," a company spokesman said on Friday.
On Saturday the British military, which is deployed in southern Iraq, said it too had no information on the hostages and that its troops were helping Iraqi forces to track them down.

Copyright AFP (Agence France-Presse), 2006