Islamic extremists in the Philippines beheaded one of three Western hostages taken captive months ago, Canadian Prime Minister Justin Trudeau told reporters Monday.

The Abu Sayyaf terror group had issued public threats to kill one of the hostages, demanding $6.5 million for each of them by Monday afternoon. Canadian Prime Minister Justin Trudeau confirmed the death of 68-year-old John Ridsdel of Calgary, saying, "This was an act of cold-blooded murder."

The terrorists were thought to be holding more than a dozen hostages, including another Canadian, a Norwegian and a Filipino woman, as well as 14 Indonesian and four Malaysian crewmen who were abducted at gunpoint from three tugboats starting last month. The head was recovered on Jolo Island in the jungle province of Sulu. 

The kidnappers reportedly took Ridsdel last September from a marina on southern Samal Island. Ridsdel is the former chief operating officer of mining company TVI Resource Development Inc., a company officer told CBC News.

Jolo Mayor Hussin Amin condemned the beheading, calling it a "barbaric act."

Military forces were moving to rescue the abductees as the ransom deadline approached. "Maximum efforts are being exerted ... to effect the rescue," the military and police said in a joint statement, without divulging details of the rescue operation, which President Benigno Aquino III had ordered.

About 400 Abu Sayyaf militants were involved in the kidnappings, police said.

In militant videos posted online, Ridsdel, along with Canadian Robert Hall, Norwegian Kjartan Sekkingstad and Filipino Marites Flor, were shown sitting in a clearing with heavily armed militants standing behind them. In some of the videos, a militant aimed a long knife on Ridsdel's neck. Two black flags hung in the background.

The abductions highlight the long-running security problems hounding the southern Philippines, a region with bountiful resources that also suffers from poverty, lawlessness and decades-long Muslim and communist insurgencies.

The Abu Sayyaf began a series of large-scale abductions after it emerged in the early 1990s as an offshoot of a separatist rebellion by minority Muslims in the predominantly Roman Catholic nation's south.

The army has weakened the group, but analysts say its ransom and extortion earnings helped it survive. The United States and the Philippines have both listed the group as a terrorist organization.

The Associated Press contributed to this report.