The device -- a JDAM (Joint Direct Attack Munition) bomb -- was dropped by a coalition warplane in the grounds of the Sheraton hotel during the campaign to oust the regime of Saddam Hussein, Sergeant Sean McCleary of the Royal Irish Guards told AFP.

"It landed on top of a number of gas cylinders. We will dispose of it either by blowing it or burning it out," he said.

A 500-square-metre (600-suare-yard) area was closed off to pedestrians near the Shatt al-Arab waterway as the disposal squad got to work.

The Sheraton was burnt and looted as the British moved in to take control of Basra last week.

It was believed to have been a favoured hangout for members of Saddam's Baath party -- a key target of US and British forces.

SPACE.WIRE