Yemen says detains local al Qaeda leader, two soldiers die in raid

ADEN (Reuters) - Yemeni troops detained a local al Qaeda leader in a raid on his hideout in eastern Yemen on Monday, only days after a military operation to foil plans to set up an Islamist state in the area, state news agency Saba said.

Saba quoted a military source as saying that two soldiers were killed by gunmen who fired on the raiding force as it approached the farm where Omar Ashour was hiding near the city of Ghail Bawazeer, in the eastern province of Hadramout.

It said Ashour, who was arrested along with his son Abdullah, were found to be in possession of passports, suggesting they had been planning to flee the country.

Yemeni troops backed by tanks and helicopters attacked al Qaeda militants in Ghail Bawazeer following reports that the group was planning to declare an Islamic state in the city.

Yemeni security sources said three soldiers, including the force commander, were killed in the fighting, along with at least seven militants. The Defence Ministry said only one officer was killed and five soldiers were wounded.

Unrest in Yemen has alarmed neighboring Saudi Arabia, the world's leading oil exporter, as well as the United States, which views Yemen as a frontline in its fight against al Qaeda.

In a U.S.-backed offensive, the Yemeni army last year drove Islamist militants out of several southern towns they had seized a year earlier. The militants have since resorted to hit and run attacks on senior officers or military installations.

(Reporting by Mohammed Mukhashaf; Writing by Sami Aboudi; Editing by Alistair Lyon)