Cairo (CNN) -- Two American tourists who were kidnapped early Thursday in Egypt's Sinai region have been released unharmed, a U.S. State Department spokesman said, citing Egyptian officials.
The U.S. Embassy has contacted the victims' relatives and is providing consular assistance, State Department deputy spokesman Mark Toner said.
The confirmation of their release came shortly after one of the men, Brandon Kutz, contradicted a statement by Gen. Ahmed Fawzi, secretary for the governor of South Sinai, who had told CNN the two men had been released and were on their way to a hotel with Egyptian security forces.
Fawzi said a deal had been reached with the kidnappers.
But Kutz told CNN that, though they were being treated "extremely well," the two were still in the custody of their captors. A few hours later, Toner confirmed their release.
The gunmen who kidnapped the two tourists Thursday morning had demanded the release of a man arrested a day earlier for drug possession, authorities said.
It was not clear if the man was released as part of a deal to secure the Americans' freedom.
The tourists, both 31, were in a car Thursday morning headed to a hotel from the town of Dahab when they were stopped, the state-run Ahram newspaper said.
The gunmen forced the tourists from the car and took them away, demanding the release of a man named Eid Suleiman Etaiwy, the newspaper said.
Etaiwy had been arrested Wednesday in possession of "a large amount of drugs," the report said.
Marwan Mustapha, a spokesman for the Interior Ministry, said government and intelligence officials negotiated with the kidnappers over the tourists' release.
Kidnappings and armed robberies have increased during the year since Egypt's long-ruling dictator, Hosni Mubarak, was overthrown.
The Sinai is one of the most underdeveloped areas in the country, and Bedouins have long complained that government services are nonexistent.
In February, two other American tourists were briefly kidnapped in the region. The kidnappers demanded that some detainees be released, but it is unclear whether the demands were met.
In January, 24 Chinese workers and a translator were kidnapped while on their way to a military-owned cement factory. A group of armed Bedouins had blocked the road they were traveling and wanted the Egyptian government to release prisoners.
The hostages were released a day after Egyptian authorities intervened, China's state-run Xinhua news agency said.
CNN's Ben Wedeman and Jill Dougherty, and journalist Mohamed Fadel Fahmy contributed to this report.