"We intercepted some conversations between militants. They were talking about the death of a 'sheikh'," said one of the Pakistani intelligence officials, referring to the title given to senior religious leaders.
"They did not name this person but we have checked with our sources in the area and believe they are referring to al-Libi."
However, a militant commander in North Waziristan closely associated with foreign fighters said: "He has not been killed. This is not the first time claims have been made about his death. The Americans are suffering heavy losses in Afghanistan so they have resorted to making false claims."
It can take months to confirm whether drone strikes have killed an Islamist militant leader because the area of the attack is often sealed off by the Taliban in the lawless north-west of Pakistan. Burials are carried out swiftly in order to hide casualties and identities.
If a drone strike did kill Libi, it would bolster the U.S. argument that drones are a highly effective weapon against militants.
The Pakistan government says that, while the CIA-run pilotless drone campaign has advantages, it fuels anti-American sentiment in the country and is counterproductive because of collateral damage.
Drones are a sticking point in talks between the U.S. and Pakistan aimed at repairing ties damaged by a series of events, including the recent imprisonment of the Pakistani doctor who helped the CIA hunt down bin Laden.
According to reports from North Waziristan, which American government sources did not contest, U.S.-operated drones launched three attacks along Pakistan's border with Afghanistan between Saturday and Monday.
Reports from Pakistan said nearly 30 people were killed during the sequence of strikes, including four suspected militants on Saturday, another 10 on Sunday, and 15 people in the strike in which Libi was targeted.
Intellpuke: You can read this Reuters article, filed from Peshawar, Pakistan, in context here: http://www.guardian.co.uk/world/2012/jun/05/us-drone-targeted-al-qaida-deputy