Security forces clashed with Islamic militants in the mountains of Sinai on Tuesday, killing a suspect in last year´s deadly bombings of beach resorts on the peninsula, the government said.

The gun battle erupted as police were chasing suspects believed involved in the Oct. 7 bombings at the Sinai resorts of Taba and Ras Shitan, which killed 34 people, the Interior Ministry said in a statement.

The ministry identified the man killed Tuesday as Mohammed Abdel Rahman Badawi, saying he took part in the Sinai bombings and was found armed with an automatic rifle and a handgun.

Witnesses said two people were killed in the shootout - a policeman and a militant - outside Ras el-Sudr, a Red Sea town 40 kilometres south of Suez. But the ministry said only that a policeman was wounded.

Suez Hospital officials, speaking on condition of anonymity, named the policeman as Ibrahim Subhi Ibrahim, 32, and said his wounds were not life threatening.

The shootout occurred when police confronted a group of suspects that they had been pursuing since Monday evening, the ministry said in a statement.

The police were continuing to pursue other suspects Tuesday, the ministry said.

Interior Minister Habib el-Adly said last month that police were closing in on two key suspects in the Sinai bombings.

A wing of the Taba Hilton Hotel was destroyed in the bombings, which was allegedly masterminded by a Palestinian who was killed in the blasts. Nine people have been charged with the bombings, including a Palestinian.

On Friday, police clashed with about 500 demonstrators who were protesting the state´s three-month detention of people suspected of involvement in the bombings. The clash, in which three police officers and about 10 protesters were injured, took place in the north Sinai town of el-Arish.

Meanwhile, The Taba Hilton Casio reopened this week after a four- month closure following the attacks, Channel 1 reported.

According to the report, the hotel has invested heavily to beef up security at the site. The entire hotel is being reconstructed and is expected to reopen this summer. (© 1995-2005, The Jerusalem Post 02/01/05)