TOKYO (REUTERS) - A deadline by the Islamic State in Iraq and Syria (ISIS) militants to pay ransom for the release of two Japanese hostages passed on Friday, with no immediate word on the fate of the captives.

The Japanese government said it was in an "extremely severe situation" while the mother of one of the hostages appealed for his safe release.

Prime Minister Shinzo Abe has said saving the men's lives is paramount but that Japan will not bow to terrorism.

In an online video released on Tuesday, a black-clad figure holding a knife stood between journalist Kenji Goto and troubled loner Haruna Yukawa, threatening to kill them if Tokyo did not pay ISIS US $200 million (S$267 million) within 72 hours. The Japanese government considers the deadline to be 2.50pm local time on Friday (1.50pm Singapore time).

"My son Kenji is not an enemy of the people of the Islamic faith. I can only pray as a mother for his release," Goto's mother, Junko Ishido, told a packed news conference, choking back tears.

"If I could offer my life I would plead that my son be released, it would be a small sacrifice on my part.

"He only went to rescue his friend. He has always looked out for weaker people, he was always helping weaker children than him," she added.

Abe has ordered his government to make every effort to secure their safe release, setting off a flurry of activity among Japanese diplomats.

The captor in the video, which resembles those showing previous Islamic State captives, says the ransom demand matches the US$200 million in aid that Abe pledged to help countries fighting Islamist militants. Abe made the pledge during a multi-nation visit to the Middle East earlier this week.

Islamic State militants have seized large areas of Iraq and Syria, and beheaded several Western captives.

Japan has stressed that its donation is for humanitarian aid, such as helping refugees, and insisted that it will not bow to terrorist threats.

SEVERE SITUATION

"The government is continuing to work in unison to gather information and make every efforts for their release," Chief Cabinet Secretary Yoshihide Suga told a regular news conference."We are in an extremely severe situation," Suga said.

Asked if Tokyo would pay the ransom, he said: "There is no change to our stance that we will not give in to terrorism and will contribute to the international response to terrorism. As we make utmost efforts for their swift release, we are negotiating through all available channels."

Japanese officials have declined to say if they would pay any ransom, a move that would put Tokyo at odds with close ally the United States.

Prior to the video's release, Japanese diplomats had told the families of the two captives that the government would not pay ransom, sources familiar with the matter said.

Tokyo's most prominent mosque, the Tokyo Camii and Turkish Culture Centre, posted a statement calling for the prompt release of the hostages.

It said Islamic State's actions are "totally against Islam and have a serious impact on Muslim communities all over the world and put Muslims in a precarious position".

Abe's handling of the hostage crisis - he must appear firm but not callous - will be a big test for the 60-year-old, but he appears to have few options.

Yukawa, aged around 42 and who dreamed of becoming a military contractor, was captured in August outside the Syrian city of Aleppo. Goto, 47, a war correspondent with experience in Middle East hot spots, went to Syria in late October to try to help Yukawa.

"He left a very young baby and left his family and I asked his wife why he made this decision and she said he had to do everything in his power to save his friend and acquaintance and that it was very important to him," said Goto's mother, struggling to hold back tears.