The Department of Foreign Affairs and Trade (DFAT) says it is not aware of any Australians involved in a terror attack in Algeria.

A DFAT spokeswoman said on Thursday it was aware of reports of a terrorist attack on a BP gas facility in the north African nation.

"We understand that hostages, including foreign nationals have been taken," she told AAP.

"At this stage we are not aware of Australian nationals involved in the incident."

The Australian embassy in Paris, which has jurisdiction over Algeria, is continuing to monitor the situation closely.

Armed Islamists say they are holding 41 hostages at the Algerian gas field after killing two foreigners.

They say they are retaliating against Algerian support for French military intervention in Mali.