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A video grab taken from television footage released on August 13, 2004, shows British journalist James Brandon (L) standing next to a hooded militant in Iraq.
The material was shot by a freelance cameraman working for Reuters who was instructed by the kidnappers to take the video
Mr Brandon's captors now say his release is "imminent", according to the Reuters news agency. The announcement follows mediation from radical Shia cleric Moqtada Sadr, unconfirmed reports say.
"I'm grateful to the Mehdi Army and I'm in good health now," Brandon, who had a black eye, told reporters shortly after his release.
He said he was treated roughly at first, but then the mood of his captors softened.
A kidnapped British journalist was released in Iraq less than 24 hours after he was abducted at gunpoint from a hotel, after aides of radical Shiite cleric Moqtada Al Sadr apparently came to his rescue.
Freelance Sunday Telegraph reporter James Brandon, 23, was paraded at Sadr's offices in the southern city of Basra, where representatives of the militia leader said he had been freed, before they handed him over to Iraqi police.
"We apologise for what happened to you. This is not our tradition, not our rules. It is not the tradition of Islam."
Sporting a black eye, he said: "Initially I was treated roughly, but once they knew I was a journalist I was treated very well and I want to say thank you to the people who kidnapped me."