SACRAMENTO, Calif. (AP) _ Federal agents have arrested two anti-government militia members in connection with a plan to blow up a massive propane installation in Elk Grove, a newspaper reported Saturday.

The Sacramento Bee, citing unidentified sources, said the arrests Friday by the FBI Joint Terrorism Task Force came after a nearly yearlong investigation into the alleged plot against Suburban Propane.

Federal officials told the paper that the threat to the plant, where 24 million gallons of liquid propane are stored, had been eliminated even before the arrests.

FBI spokesman Nick Rossi referred all inquiries to the U.S. Attorney for the Eastern District of California, who did not immediately return a call seeking comment this morning.

Authorities believe the alleged plan was designed to exploit Y2K fears among the nation's hate groups.

``We think we stopped a terrorist attack,'' a source close to the investigation told the Bee. ``Can we be certain they would have carried it out? We don't know. We had to behave as though they were going to do it.''

Authorities said the two men, whose names were not disclosed, were arrested on weapons charges and held while federal agents searched their El Dorado County homes for evidence. Storage lockers and homes in Reno, Nev., and Carson City, Nev., also were searched.

Both were members of a San Joaquin County militia group and had been stockpiling large amounts of illegal weapons, law-enforcement sources said. One is a convicted felon with firearms violations; the other is unemployed and has no past criminal record, but sources said he is knowledgeable in bomb making, and a large amount of explosives were found at his property.