Updated

Police say bombing kills at least 12 in southern Philippines

At least 12 people were killed and another 20 wounded when a bomb exploded during a town festival Tuesday in the southern Philippines, where security officials were put on alert for possible attacks by al-Qaeda-linked militants, police said.

CountryWatch: Philippines

North Cotabato provincial Police Chief Federico Dulay said the bomb, believed to be made from an 88mm mortar shell, went off at about 8 p.m. (1200 GMT) in front of the town hall of Makilala town in the southern part of the province.

"Clearly this is a terrorist act," Dulay said.

Another bomb injured five people earlier Tuesday in a public market in Tacurong city, in southern Sultan Kudarat province, as U.S. and Philippine officials said they had received credible intelligence that a terrorist group may be planning to carry out bombings in the southern Mindanao region, where the wife of a top Indonesian militant was captured last week.

The U.S. Embassy warned that it had received "credible information" about possible attacks, particularly in cities in central Mindanao, "over the next several days."

Two Philippine security officials monitoring the area agreed, citing possible retaliation for last week's arrest of Istiada Binti Oemar Sovie on southern Jolo island, in the Mindanao region. Sovie is the wife of Dulmatin, an al-Qaeda-linked Indonesian militant and one of Asia's most wanted terror suspects for his alleged role in the 2002 Bali bombings that killed 202 people.

Quoting witnesses, Dulay said an unidentified man carrying a plastic bag went to a stall selling alcohol in a crowded area along a highway during celebrations of Makilala's founding anniversary, bought a bottle of wine, then left.

The explosion occurred minutes later, killing a man and a woman on the spot, he said. Ten other people died en route to a hospital in nearby Kidapawan city or while being treated there.

A row of commercial stalls, a carnival and cultural presentations in a nearby gymnasium have attracted crowds this week. The powerful explosion destroyed a row of stalls and two motorcycle taxis and dug a crater in the asphalt road, Dulay said.

"The area is a total wreck," Dulay told local DXND radio.

Makilala is a small banana- and rubber-producing town 950 kilometers (590 miles) southeast of Manila. Communist and Muslim guerrillas are known to have a presence in the town.

A security guard found the bomb in Tacurong, a predominantly Christian agricultural region not far away. It was stashed in a bag filled with packs of corn chips, and the guard hurled it away from a crowd before it exploded, preventing more casualties, army Col. Felipe Tabas said.

"Nobody can do this except terrorists," he told The Associated Press by telephone.

The bomb also was made from a small mortar round and could be remotely triggered using a cell phone but it apparently went off prematurely after the guard tossed it away, police Chief Superintendent German Doria.

Such bombs have been used in the past by al-Qaida-linked groups like the Indonesian-based Jemaah Islamiyah and its local ally, the Abu Sayyaf group, but investigators were trying to determine if other groups, like extortion gangs, were involved, Doria said.

About 10 security guards were deployed recently at the market because of intelligence reports it could be targeted, he said.

In southern Zamboanga city, police are on alert to safeguard an annual Roman Catholic festival that culminates with a public parade on Thursday. The predominantly Christian city of about 700,000 has been hit by deadly bomb attacks in recent years that were blamed on the Abu Sayyaf, which is on a U.S. list of terrorist groups.

The United States has offered a US$10 million (euro7.9 million) reward for the capture of Dulmatin and US$1 million (euro0.79 million) for another Indonesian, Umar Patek. The two are believed to be hiding in Jolo with Abu Sayyaf guerrillas.