Maiduguri - Multiple explosions were heard Sunday on the outskirts of Maiduguri, local residents said.
But the army said the blasts, which caused some panicked residents to flee, were a result of the test-firing of weapons during military exercises in the area.
Residents said the explosions were heard from from the areas of Kayamla and Dalori, three days after the insurgents attacked Maiduguri, leaving 10 people dead and many more injured.
"We are not sure whether the terrorists are planning to invade the town but the sound vibrating is devastating," said Kursi Yusuf, an employee at the University of Maiduguri.
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Khadija Mustapha, a resident of Dalori Quarters, 11 kilometres from Maiduguri, said she had fled her home with her three daughters for fear of being caught in the explosions.
"I don't know what will happen. The sound of the explosives is really disturbing," she said. "Many of us... have vacated our homes."
But the army said it was conducting military exercises in the volatile city and urged residents not to panic.
"It is a routine test-firing of our weapons to ensure they are in a state of readiness," Colonel Tukur Gusau, spokesman for the Nigerian 7 Division in Maiduguri, told AFP.
Earlier a military officer who did not want to be named had confirmed the series of blasts but said troops were on top of the situation.
"The terrorists will not have their way," he told AFP.