Updated

Iraq is placing explosives at the Kirkuk oil fields in northern Iraq, Fox News has confirmed, raising new fears that Saddam Hussein may be planning to blow up its oil production facilities to prevent them from being taken over in a war with the U.S.

There are no specifics on the types or amounts of explosives the Iraqis are using, but U.S. officials say they are seeing new activity in the area.

Last week, the Pentagon cited reliable reports that Iraq planned to plant explosives at its oil wells, and that in some cases they "had already begun."

Iraq recently received twenty-four railroad boxcars filled with Pentolite explosives, Fox News learned.

In Baghdad, an oil ministry official denied the report.

"Iraq is keen to defend its oil wells and it is illogical that we burn our oil wells with our own hands," Oil Undersecretary Hussein Suleiman Al-Hadithi told Reuters.

U.S. officials have raised fears for several months that Iraq would employ a "scorched-earth" policy if it appears on the verge of losing a war, setting its oil wells on fire rather than see them fall into the hands of allied forces.

The Iraqis set Kuwaiti oil wells ablaze when they retreated from their neighbor at the end of the 1991 Gulf War.