Hezbollah says Israel prisoner swap talks go on

BEIRUT (Reuters) - Hezbollah said on Monday talks for a prisoner swap with Israel were continuing despite the killing of its top military commander in an assassination the Lebanese guerrilla group blamed on the Jewish state.

Sayyed Hassan Nasrallah reiterated his pledge to take revenge for the February 12 assassination of Imad Moughniyah. "We shall pick the time, the place, the punishment and the means and method," Nasrallah said.

Moughniyah commanded Hezbollah's guerrilla forces during the 34-day war with Israel in 2006. The war was triggered when Hezbollah, which is backed by Syria and Iran, raided Israel and captured two soldiers, saying it wanted to use them to negotiate a prisoner swap.

Moughniyah was killed by a car bomb in Damascus.

"Among his hopes was the liberation of the prisoners and we will continue this work despite the fact that the Israelis killed (Moughniyah)," Nasrallah said in a speech to commemorate the 40th day since his death.

"We did not halt the negotiations for the exchange of prisoners. Meetings happened recently and we will not halt the negotiations," he said.

Nasrallah's own movements are kept top secret. He delivered his address to thousands of supporters via a videoscreen.

Hezbollah still holds the two soldiers it seized in 2006. A U.N. appointed negotiator, believed to be a German intelligence officer, is working on a prisoner swap. Hezbollah has given no word on whether the two are alive and, if so, their condition.

Israel and Hezbollah exchanged the remains of an Israeli civilian in October for a captive Hezbollah fighter and the bodies of two other guerrillas in a U.N.-brokered deal.