Gunmen's "royal army" ID adds twist to Malaysia border standoff

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KUALA LUMPUR (Reuters) - About 100 armed men holed up in a village in the eastern Malaysian state of Sabah identified themselves as the "royal army" of the Sultanate of Sulu in the southern Philippines, adding more mystery to a bizarre border standoff.

Malaysian officials said on Thursday they suspected the intruders were a faction of a Philippine Muslim rebel group, while Philippine officials said they were unarmed Filipinos who had been promised land.

The drama on Borneo island has threatened to stir tension between the Southeast Asian neighbours whose ties have been periodically frayed by security and migration problems caused by a porous sea border.

The Malaysian police chief told reporters late on Thursday that the group had identified themselves as representing the Sultanate of Sulu, a string of islands in the southern Philippines that has a historic claim to Malaysia's Sabah state.

"We have sent a team to negotiate with them. Discussion is proceeding well and we have told them to leave Sabah peacefully, as we do not want any situation which can threaten the security of the people," Inspector-General of Police Tan Sri Ismail Omar told a news conference, according to state news agency Bernama.

He said the group had agreed to leave Sabah once their demands were met, without specifying the demands.

"So far, the situation is not tense and they (the group) appear to be behaving well," Ismail said in a separate statement to Bernama.

The Philippine embassy in Kuala Lumpur has sent a team to Sabah to coordinate with local authorities and to ascertain the identities of the group.

Malaysia pays a token amount to the Sultanate of Sulu each year for the "rental" of Sabah state - an arrangement that stretches back to British colonial times.

In 2000, a group of militants from the southern Philippines kidnapped 21 tourists from the Sabah diving resort of Sipadan.

In 1985, 11 people were killed when gunmen believed to be from the southern Philippines entered Lahad Datu in Sabah, shooting at random before robbing the local branch of Standard Chartered Bank

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