Malaysia's defence ministry had said that two grenades were hurled into the Ban Di Samoe outpost in northern Kedah state before dawn Wednesday.

"It was all made up," Malaysian defence ministry spokeswoman Fadzlette Othman Merican told AFP.

"This was an accident and maybe in the initial report they (the troops) were scared and so they could have created a story to cover up the accident," she said. "We are still investigating the report."

Deputy army chief Lieutenant General Muhammad Ismail Jamaluddin had said Friday that the soldiers spotted seven unidentified gunmen after the attack as they cleared a landing strip near the base.

But late Friday he issued a statement saying the incident was in fact not the work of intruders, and that the hand grenades that exploded belonged to the Malaysian army.

"The army regrets the confusion caused over the incident," he said, adding there had been an "accidental discharge of explosives" during routine operations at the outpost.

"No intrusion whatsoever took place at the Ba Din Samoe post," he said.

Thailand's army had offered a different explanation, saying that it was an accident that took place as some 50 Malaysian and Thai soldiers conducted a joint patrol. But Malaysia said no joint operations were being held at the time.

Southern Thailand is in the grip of a three-year separatist insurgency, which has left 1,800 people dead.

Agence France-Presse