ABC reporter Peter Lloyd has spoken to The World Today program from the scene in central Sydney.
"I'm standing in Chifley Square, as you say, the heart of Sydney. The RBA (Reserve Bank of Australia) is just a short walk away; Parliament House, the Governor Macquarie Towers where the Premier and Ministers work from, law firms; there's a lot of high-end retailers for the well-heeled.
"All this money, power and influence in the centre of Sydney has now been completely shut down. The crowd's are being pushed back; I'm standing, as I said, in Chifley and I'm on the very edge of the police perimeter that's been set up by the riot squad.
"There's a wall of blue at every street around the precinct and the perimeter of the cafe. Behind that is a series of banks of cameras and live AV trucks, and even 12-13 metres behind that, curious onlookers who are, at this point, being told by the police they can stay, but they are being cautioned that this is an operation that's unfolding; the threat assessment is being made minute-by-minute.
"There's been unconfirmed reports of sightings of bombs and other devices around the city. Nothing's been confirmed but the police are going around looking at drainage pipes, drainage holes.
"The streetscape is basically under complete suspicion as police try and get an assessment of whether this is just that cafe or is there something else going on here."
"Inside the cafe, we believe there are 13 people and possibly one gunman. I heard reports from other journalists that it's a pistol, but these are unconfirmed reports; we don't know what it is yet, and we don't know who it is and we only know the association to the Islamic State because of the reports about the flag, the jihadist flag being draped in windows.
"And that's the flag that's been appropriated by ISIS. They grabbed it and put it across all of their marketing and advertising as you've seen this year in the Middle East."
by Luke Royes 8:29 PM
