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Indonesian President Susilo Bambang Yudhoyono confirmed Wednesday that suspected terror mastermind Dulmatin had been killed in a police raid near Jakarta.

The President, on a three-day visit to Australia, said a raid against militants hiding out in Pamulang, Tangerang had resulted in the death of the man believed to have been behind the 2002 bombings on the resort island of Bali.

"I have great news to announce to you," Yudhoyono told an official luncheon in Canberra through an interpreter.

"After a successful police raid against a terrorist hiding out in Jakarta... we can confirm that one of those killed was Mr Dulmatin, one of the top Southeast Asian terrorists that we've been looking for."

Dulmatin, an Al-Qaeda-trained bomber, is the suspected mastermind of some of the region's most notorious attacks and the United States' Rewards for Justice program had posted a 10 million US dollar bounty on his head.

He was wanted for allegedly helping organize and carry out Indonesia's most deadly terror attack -- the suicide bombings of two Bali nightclub in 2002 which resulted in the deaths of 202 people, including 88 Australians.

Australian Prime Minister Kevin Rudd had earlier praised Indonesian counter-terrorism forces for their difficult and dangerous work in fighting extremists.

"The breakthroughs which Indonesia has made in undermining various terrorist networks have been significant," Rudd told a joint press conference with the Indonesian leader.

Born in Central Java in 1970, Dulmatin joined a religious boarding school set up by Abu Bakar Bashir, spiritual leader of regional terror network Jemaah Islamiyah, as a young man.

He then then joined an underground regional cell and in the course of his career underwent training in Afghanistan and accumulated an array of aliases, including Joko Pitoyo, Joko Pitono, Abdul Matin and Muktarmar.

The event for which he is infamous is the 2002 Bali bombings which sent shockwaves around the world, coming after the September 11 attacks in the United States the previous year.

Following the bombing of Jakarta's JW Marriott hotel in August 2003 Dulmatin fled to the southern Philippine island of Mindanao, another centre of Islamic militancy in the region.

In 2008, Philippine military officials said they believed Dulmatin's body had been exhumed on the southern Philippine island of Tawi-Tawi.

AFP