Mowaffak Al Rubaie, Iraq's national security adviser, said authorities had "very good, strong intelligence telling us they are alive".

Rubaie added, "And we roughly know the area where they are … But we don't want to be aggressive in our approach, not to risk their lives."

The Britons - a computer instructor and his four bodyguards - were seized by a Shiite group from inside an Iraqi Finance Ministry building in a raid in Baghdad in May 2007.

There was no news of the men until a video featuring one of the hostages was released last December. It included a statement from his captors threatening to kill him unless Britain pulled its troops out of Iraq.

A second video was released in February, this time featuring a second hostage who appealed for the release of nine Iraqis in return for the Britons' freedom.

The BBC said Rubaie was speaking after a visit to Baghdad by a senior Anglican churchman, who appealed for the men to be released for their families' sakes.

Agencies