A Shiite Islamist group yesterday posted an internet video showing a hostage in US military uniform who appears to be a contractor for an American firm reported missing in Iraq by the Pentagon.

The video surfaced shortly after a US defence department statement said civilian contractor Issa T. Salomi, 60, of El Cajon, California, had been missing since January 23 and a search launched to find him.

The unnamed man in the video is pictured against a black flag bearing the name of the League of the Righteous, the Shiite militant group which kidnapped British IT expert Peter Moore and his bodyguards in Baghdad in May 2007.

In a video that runs less than two minutes, he read out the group's demands for the release of Iraqi prisoners and conviction of employees of US security firm Blackwater, since renamed as Xe Services.

"The second demand is to bring the proper justice and the proper punishment to those members of the Blackwater company who have committed unjustifiable crimes against innocent Iraqi citizens," the hostage said.

"I also would like to relay the justifiable demand of the Iraqi Islamic resistance for the complete withdrawal from Iraq, so Iraq can become a sovereign nation."

The hostage said he was in good health.

"I would like to express to all the members of my family, especially my wife, my children and my friends and to assure everybody that I'm being treated kindly and I'm in good health," said the man.

If the kidnapping is confirmed, it will be the first such case involving a foreigner in Iraq since the same group kidnapped five Britons in 2007.

US Vice-President Joe Biden announced during a visit to Baghdad in January that Washington will appeal a judge's decision to clear five US security guards accused of killing 14 unarmed Iraqis in 2007 while working for Blackwater.