Shiite Muslim kidnappers Friday freed American Thomas Sutherland and Briton Terry Waite, two key Western captives whose release represents a dramatic advance in ending the long hostage ordeal.

The release of the men was confirmed in Beirut by Lebanon's foreign minister, Fares Bweiz, and in New York by Nadia Younes, a spokeswoman for U.N. Secretary-General Javier Perez de Cuellar.The U.N. chief said the kidnappers had offered to free all hostages by Christmas.

Younes said Waite and Sutherland were en route to Damascus, the Syrian capital and the traditional transit point for freed hostages.

The 52-year-old Waite, who had successfully negotiated the release of other hostages, went to Beirut to try to free Americans but shockingly dropped from sight during his mission and became a captive himself for nearly five years. He was believed to be the last British hostage in Lebanon.

Sutherland, 60, was the hostage held the second-longest - nearly 61/2 years. His release leaves three American captives, two Germans and an Italian in the hands of Lebanese kidnappers.

Since 1984, when Shiite and Druse militiamen chased the Lebanese army from west Beirut, almost 100 foreigners have been abducted in Lebanon. Ten of the captives were either presumed or confirmed killed. A few said they escaped, and others were released.

The pace of the releases has quickened since August, when the United Nations began working to mediate a broad swap of Western hostages for Arab prisoners and missing Israeli soldiers.

Six longtime hostages - three Americans and three Britons - have been freed since August. A Frenchman held for three days also was released.

Bweiz said in a statement broadcast by Beirut radio stations that "the release has taken place, and I want to extend my congratulations to the Waite and Sutherland families and urge the families of the rest of the hostages to be patient. Their ordeal is approaching an early end."

The Iranian-allied kidnap group, Islamic Jihad, announced Monday that Waite and Sutherland were being freed but left the timing of the release unclear.

Islamic Jihad made its announcement in an Arabic-language statement issued to a Western news agency in Beirut accompanied by an old photograph of Terry Anderson. Anderson, chief Middle East correspondent for The Associated Press, has been held the longest of any hostage. He was abducted March 16, 1985.

Israel and its allied Lebanese militia have released 66 Arab captives, and the Israelis have received firm word on the death of two missing soldiers and the body of a third.

Perez de Cuellar's spokeswoman said the U.N.'s special hostage negotiator, Giandomenico Picco, reported the release of Sutherland and Waite.

Perez de Cuellar also confirmed at the United Nations Monday that he has been offered the release of all hostages by Christmas.

"That is what I have been offered by the groups as well as by the Iranian government, which has always given me very strong support, as well as the Syrian government," the U.N. chief told reporters.

Waite was special envoy for the archbishop of Canterbury when he disappeared in Beirut on Jan. 20, 1987, after going to meet with representatives of Islamic Jihad.

Sutherland, dean of agriculture at the American University in Beirut, was kidnapped June 9, 1985, when gunmen attacked his car as he drove in a convoy from Beirut airport. The Scottish-born Sutherland, a naturalized American citizen, lived in Estes Park, Colo.

Sutherland's wife, Jean, who has lived in Beirut since his abduction, left the Lebanese capital Sunday because her 88-year-old father died the day before in Iowa. She reached the United States Monday but reportedly canceled her flight to Iowa when word came of her husband's release. Relatives said she would go to Germany - where freed American hostages are medically checked and debriefed.

Lord Runcie, the former archbishop of Canterbury who sent Waite to Beirut, told Sky Television: "I'm looking forward to seeing Terry. I hope it will be a day this week."

And Runcie told Cable News Network: "(Iranian President Hashemi) Rafsanjani has signaled his desire to remove the obstacle to international relations. Now it's clear he wants to move ahead quickly."

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The Tehran Times, in a report released Sunday, had said that an American and a British hostage would soon be freed on humanitarian grounds.

British Prime Minister John Major reacted cautiously to word of Waite's release, saying Waite had not yet been turned over to British officials. But he told reporters in London: "If the reports are correct, he should be with us this evening, and I very much hope on his way home here tomorrow."

Israel Monday welcomed the release of Waite and Sutherland, saying it hoped for a release of its own missing soldiers. A government statement made no mention of any future releases of Lebanese prisoners under Israeli control.

The United States said it had not officially heard of the releases. But the government sent one team of experts to Germany, where freed American hostages are medically checked and debriefed.

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