“Our troops thought it was a bomb but found out it was a head,” Sitin said by telephone from Jolo, a poor, predominantly Muslim region.

Earlier, Canadian Prime Minister Justin Trudeau declared that his government has “every reason to believe” that Hall had been killed by the Abu Sayyaf, the second Canadian captive to be slain this year.

Members of the notorious kidnap-for-ransom Abu Sayyaf gang had said they would murder Hall if they did not receive 300 million pesos ($6.5 million) ransom by Monday afternoon.

Hall was among four people abducted in September last year from aboard yachts at a tourist resort on Samal island in the southern Philippines.

Another Canadian kidnapped at the same time, John Ridsdel, was beheaded in April after a similar ransom demand of 300 million pesos was not paid.

The fates of the two other people abducted at the Samal resort - Hall’s Filipina girlfriend Marites Flor and Norwegian resort manager Kjartan Sekkingstad - were not known.

A militant video obtained by Philippine police officials and seen by The Associated Press showed Hall in an orange shirt and kneeling in front of a black Islamic State-style flag before he was killed in a jungle area.

The beheadings have taken place despite the heavy deployment of military and police forces to locate them in the strife-torn island of Jolo, the largest island in the Muslim-populated archipelago of Sulu, about 1,000 kilometres from Manila.

In an Abu Sayyaf video posted on YouTube after Ridsdel’s death, Hall and the two other hostages, Sekkingstad and Flor, pleaded to Canadian and Philippine officials to negotiate their release.

“We live like this every day, go to bed like this,” Hall said, raising his arms to show that he was handcuffed. We have a hundred people heavily armed around us all the time that dictate to us and talk to us like children. We’ve been humiliated in every way possible. One of us has already been murdered.“

Hall spoke later in the video for a second time, sounding resigned to a tragic fate.

“I would also like to thank my family for the effort they put in — my family and friends for the effort they put in — to get me out of here. I know you did everything you can, and I truly appreciate it. I’m sorry I got you in this mess,” he said.

Major Filemon Tan, spokesman of military forces in the south, said Tuesday that the kidnappers were evading military pursuers with the help of the impoverished Muslim residents of the island.

“They have relatives in the community. They are the ones that give them a warning when there are soldiers in the area,” he told said.

He also said the island’s forested, hilly terrain, a broad coastline that allows for swift movement by boat and the kidnappers’ tactic of breaking up into smaller groups, were all hindering pursuit.

“But we are studying this deeply and I can say we are adjusting and it will be a matter of time that we will hit them also,” he added.

In Manila, President-elect Rodrigo Duterte’s national security adviser said Duterte’s new government, which takes charge on June 30, would “take a stronger action against lawlessness in the south”.

“We cannot allow this situation to continue, this should end once and for all,” Duterte’s adviser Hermogenes Esperon said.

Listed by the United States as a terrorist organisation, the Abu Sayyaf is a loose network of Islamic militants that was founded in the early 1990s with money from Osama bin Laden’s Al-Qaeda network.

Its leaders have in recent years declared allegiance to the Islamic State group that holds territory in Iraq and Syria.

Additional reporting by Reuters and Associated Press