Bali bomber, Dulmatin, in Malaysia

Indonesian-born Dulmatin, wanted in connection with the 2002 Bali bombings that killed 202 people, was hiding on an island off Malaysia's Borneo, the Philippine Star newspaper was quoted by AFP as saying.

Dulmatin, a senior member of the Jemaah Islamiyah militant group, was not on Basilan or Sulu islands in the southern Philippines, the newspaper said, citing "a reliable Indonesian source".

Philippine military chief General Hermogenes Esperon said he doubted the accuracy of the report, telling reporters: "I don't know whose report that is.

But we have reports that he is in Sulu with some other high value targets."

He said the hunt for Dulmatin in Sulu was hampered by rugged terrain and a lack of reliable intelligence.