Secret papers found in Saddam Hussein's (search) hiding place reveal that he had regular contact with the leader of the terrorists who oppose the U.S. presence in Iraq, military officials told The Post.

The papers prove Saddam communicated with Izzat Ibrahim al Douri (search), his former deputy in the Ba'ath Party - the political organization behind his reign of terror.

Details were sketchy, but the documents show Saddam was more deeply involved in the resistance than previously believed, the officials said.

And the farm complex in Adwar where Saddam was found hiding in a "spider hole" Saturday may have been a terrorist meeting spot.

People coming to see Saddam could get there by boat on the nearby Tigris River (search), the official said.

Saddam's communication with al-Douri is just part of a treasure trove of secrets found at the hiding place - which led yesterday to the arrests of two key Iraqi terror leaders.

U.S. officials said that crucial documents, found in the Butcher of Baghdad's briefcase, included a list of six names, including two financiers, two bomb makers, and the two arrested resistance leaders, described as distant relatives of Saddam.

The documents also detailed the structure and financing of eight to 12 vicious terror cells around Baghdad - of which the U.S. had known little.

The information should bring more arrests in the coming days, said officials.

"Some were things we already knew about and we just needed the intel to go after them. I think we'll get some significant intelligence over the next couple of days," said Gen. Mark Hertling of the Army's 1st Armored Division.

Uncovering Saddam's involvement with and knowledge of recent Ba'athist death-squad activities remains the first priority of CIA agents interrogating Saddam.

"I'm sure he was giving some guidance to some key figures in this insurgency. When you take down a mob boss, you don't know how much is going to come out of it," Hertling told reporters.

But so far, Saddam remains grumpy and uncooperative, sources said, spending much of Day 2 of his sessions with the CIA refusing to say much beyond "rote" political rhetoric.

"He's been fairly defiant," an official told Fox News. "While he's talkative, he's provided nothing substantial. His comments are self-serving, lengthy rationalizations of his behavior, and he punctuates a lot of it with wise-ass and deflective remarks."

When he was first found, Saddam immediately offered to negotiate, according to some reports.

Saddam, who was initially interviewed at a secure holding facility at the Baghdad International Airport, has been taken to a secret location inside Iraq.

According to U.S. officials briefed on the interrogation sessions, the ex-tyrant has gone through a series of wild mood swings since being captured on Saturday.

He was first reported to be "bewildered" and "disoriented" when he arrived in Baghdad.

But after a shower and nap on an army cot, he was defiant as he met with members of Iraq's governing body, claiming he was a "fair and just" ruler and that people found in mass graves were "thieves and army deserters."

"I found a very broken man," said governing council member Muffaq al-Rubaiye.

He said Saddam would not look at Iraq's political leadership during their meeting and seemed to be trying to make eye contact with Paul Bremer, the chief U.S. administrator in Iraq and Lt. Gen. Ricardo Sanchez, commander of U.S. forces in Iraq.

"He was, I think, psychologically ruined and very demoralized. His body language showed that he was very miserable. He felt safer with the Americans," Rubaiye added.

Looking ahead, U.S. officials said they plan to treat him the same way they treated top Al Qaeda prisoners like 9/11 plotter Khalid Sheik Muhammad, meaning his interrogation could last for months and that he could be subjected to physical and psychological pressures.