Five hostages have escaped from a Sydney cafe held under siege by an armed man showing Islamic flags on Monday.
Originally, three hostages escaped, but later two more people have been seen leaving the cafe.
The siege began on Monday morning and involved hundreds of armed police surrounding the cafe in the centre of Sydney.
The hostages have been forced to hold a black and white Islamic flag on the cafe window.
A police spokeswoman confirmed that officers were attending the scene and an operation was underway surrounding the Lindt Chocolate cafe.
Lindt Australia CEO, Steve Loane, told newsmen that he believed there were 40 people inside the cafe, including customers and staff.
According to a report, the gunman has told police negotiators that they have planted “devices” all around Sydney and demanded to talk to Prime Minister Tony Abbott.
It said local nearby streets had been closed and all trains near the area shutdown.
Police have also evacuated the Sydney Opera House and shut down traffic on the Sydney Harbor Bridge.
The Federal Government has convened a meeting of the National Security Committee.
There had been warning for months that a terror attack could happen in Australia.
New South Wales Police Commissioner, Andrew Scipione, told reporters that police are doing all they can to resolve the situation peacefully.
He said there were tight controls around the location, and they had not made contact with the gunman.
“The officers are well trained, they know what they are doing,” he said.
Mr. Scipione said that police still did not know the gunman’s motivation and were working to determine where he was from.
He said the police presence is “very heavy”, and involved hundreds of police officers.
He said police were still trying to determine what the Islamic flag stands for.
“It is a flag that we have had people looking at, we are working with partner agencies to better determine what we are dealing with,” he said.