Aussie journalist caught up in Timor violence. 23/05/2006. ABC News Online

An Australian journalist has been caught up in new violence in East Timor's capital Dili.

Australian consular officials are preparing to send an armoured vehicle to rescue David O'Shea, from the SBS program, Dateline.

It is understood shooting broke out this morning between East Timorese troops and a rebel group at Becora, on Dili's outskirts.

It is feared two soldiers may have been killed and another two injured.

Mr O'Shea is now in a secure location and waiting for assistance from Australian officials.

The executive producer of Dateline, Mike Carey, says Mr O'Shea has not been injured.

"He went out to interview a renegade policeman this morning just on the outskirts of Dili and he was interviewing ... and just about to finish the interview and shooting started," he said.

"Troops loyal to the Government were firing upon these rebel policeman."

Australia's Ambassador to East Timor, Margaret Twomey, has spoken to the offices of East Timor's Prime Minister and President, appealing for their help to ensure Mr O'Shea's safety.

A Dili-based journalist says soldiers and police had gone to the area to control violence between civilians that had broken out in recent days.

It is understood the unrest is away from the city centre, where mass riots two weeks ago left five people dead and buildings torched.

Australia sent Navy ships to northern waters in case the East Timorese Government requests help.

The Foreign Affairs Minister, Alexander Downer, has told Parliament the Government has been receiving reports that parts of Dili and other areas have descended into violence.

The Minister says there are reports of injury and property damage.

Mr Downer has also told Parliament an independent commission investigating the grievances of hundreds of sacked East Timorese soldiers needs to report back quickly.

"We encourage all parties to resolve their differences in a manner consistent with the rule of law, with democracy and with international norms of human rights," he said.

"Rebel military and security personnel must cease destabilising the situation and work with the Government to resolve their differences."

He says Australia is ready to help if the East Timorese Government or the United Nations requests assistance.

"We've pre-positioned some military assets in northern Australia, including naval vessels, aircraft and even some troops to enable a rapid response to assist with evacuation or some other form of assistance if it's required," he said.