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Eight Israel Defense Forces soldiers were killed and two others were abducted Wednesday in attacks by guerillas from the militant Hezbollah organization.

Hezbollah leader Sheikh Hassan Nasrallah said Wednesday evening that a prisoner exchange was the only way to secure the release of the soldiers, who he said were being held in a "secure and remote" location.

"No military operation will return them," Nasrallah told a news conference in Beirut. "The prisoners will not be returned except through one way: indirect negotiations and a trade."

The militants attacked two IDF armored Hummer jeeps patrolling along the border with gunfire and explosives, in the midst of massive shelling attacks on Israel's north. Three soldiers were killed in the attack and two were taken hostage.

Later in the day, four IDF soldiers were apparently killed when their tank hit a mine some 6 kilometers inside Lebanese territory.

One of the soldiers, Sergeant Nimrod Cohen, was seriously wounded during the attempted rescue of his comrades trapped in the tank. Cohen later died of his wounds, Israel Radio reported.

Earlier, the army released the names of two of the soldiers killed: Shani Turgeman, 24, of Beit Shean and Eyal Benin, 22, from Be'er Sheva.

The army withheld news of the deaths for several hours while the soldiers' families were notified.

Hezbollah said its guerrillas destroyed two Israeli tanks that attempted to cross the border into Lebanon on two different occasions Wednesday.

The IDF had Wednesday afternoon sent troops across the border to search for the missing soldiers, marking the first incursion into Lebanon since the withdrawal in May 2000.

Army Radio reported large numbers of troops, as well as aircraft, were taking part in searches on the Lebanese side of the border.

According to Channel 10 television, the IDF later said that it had lost all hope of retrieving the abducted soldiers with ground forces.

The IDF also ordered troops deployed on the Lebanon and Gaza borders on high alert in the event that armed groups may attempt to fire Katyusha and Qassam rockets into Israel.

GOC Northern Command Udi Adam told reporters that Israel plans to "push back" Hezbollah guerrillas controlling southern Lebanon, adding that the IDF has "no intention at the moment of involving Syria," which has great influence over Hezbollah.

"We think at the moment the debate is beween us and the government of Lebanon," he said.

Immediately after the Hezbollah attack, the organization's Al-Manar television station began broadcasting clips calling on Israel to release Lebanese prisoners held in Israel in return for the soldiers.

The group in particular emphasized the release of Lebanese militant Samir Kuntar, jailed in Israel since a 1979 attack in the northern town of Nahariyah, in which he entered an apartment and murdered three family members and an Israeli police officer.

Al-Manar also broadcast video clips of previous Palestinian and Lebanese attacks on IDF troops.

"Fulfilling its pledge to liberate the [Arab] prisoners and detainees, the Islamic Resistance... captured two Israeli soldiers at the border with occupied Palestine," the Syrian- and Iranian-backed Hezbollah said in a statement.

"The two captives were transferred to a safe place," it said, without stating what condition the soldiers were in.

Cabinet authorizes 'severe' responseIsrael's cabinet on Wednesday authorized what it called a "severe" response after the cross-border attacks.

A statement issued by Prime Minister Ehud Olmert's cabinet said Israel holds the Lebanese government responsible for the attacks and for the safe return of the abducted soldiers.

"Israel holds the sovereign government of Lebanon as responsible for the action which emanated from its territory and for the safe return of the abducted soldiers."

"Israel must act with appropriate severity in response to this attack and it will do so. Israel will respond in a forthright and severe manner against the perpetrators responsible and will act to prevent future efforts and actions directed against Israel."

Reserve troops called upIn the wake of the attack, IDF Chief of Staff Dan Halutz headed into the military's war room at the Defense Ministry complex in Tel Aviv, Channel 10 television reported.

During consultations, senior IDF officers called for an end to the restraint against Hezbollah and said Lebanon should be made to pay a heavy price.

Halutz ordered the IDF to mobilize a reserve infantry division that was expected to be sent to the northern border. General Staff exercises held over the past several years tested a number of possible responses to kidnapping scenarios.

One of these responses involves the massive incursion of IDF ground forces into Lebanese territory. Military sources told Haaretz that Israel is liable to act with the aim of "altering the rules of the game on the northern front."

Two Israelis were wounded when gunmen in Lebanon began pounding the IDF's Zarit position and other posts along the border before 9 A.M. According to Al-Manar, Hezbollah kidnapped the two IDF soldiers at 9:05 A.M. and transferred them to a safe location.

The two were wounded either by mortar shells or rockets that slammed into Moshav Zarit. One was lightly to moderately wounded and the second was lightly hurt. Two other people suffered from shock. All four were evacuated to a hospital in Nahariya.

IDF responded to the attacks from Lebanon with heavy artillery and tank fire. Al-Manar television reported that IDF artillery was pounding the fringes of the villages of Aita el-Shaab, Ramieh and Yaroun in the hills east of the coastal border port of Naqoura.

Israel Air Force jets struck roads, bridges and Hezbollah guerrilla positions in southern Lebanon, Lebanese security officials said. The air raids were apparently intended to block any escape route for the guerrillas who may be taking the captured IDF soldiers to areas further removed from the border in order to prevent an Israeli rescue mission.

Lebanese security sources said two Lebanese civilians were killed and a Lebanese soldier was wounded in the IAF air strike on the coastal Qasmiyeh bridge in the south of the country.

The fighting apparently began when at least two rockets fired from south Lebanon exploded near Shlomi, located about 15 kilometers east of the Mediterranean coast, Reuters reported. Hezbollah guerrillas also attacked IDF positions in the Shaba Farms area to the east, Lebanese security sources said. Channel 10 said that the Hezbollah attack and kidnapping took place the same day that IDF units were switched in the border area.

Olmert said in response to the violence in the north that enemies are putting Israel to a test. He said they would fail in their efforts and would pay a "heavy price" for their actions.

"These are difficult days for Israel and its citizens," Olmert told reporters. "There are elements, to the north and the south, that are threatening our stability and trying to test our determination," he said. "They will fail and pay a heavy price for their actions."

Media reports said that before the cabinet meeting, Olmert would consult with IDF and defense officials on a military response to the events on the border.

Meanwhile, the Lebanese government-affiliated press said Israel Navy warships had entered Lebanese territorial waters and IDF forces were massing in the border area.

The possibility of border clashes in the north was raised during security situation meetings over the past two weeks since the kidnapping of IDF soldier Gilad Shalit next to the Gaza Strip.

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