Police have declared an emergency situation after reports of a gunman near a pub in the central business district of Mackay in north Queensland.
The man was spotted near a hotel on Gregory Street late this afternoon.
A witness told the ABC the man was seen firing shots into the air.
He is believed to be carrying two guns.
Surrounding streets were locked down and people in the area were urged to stay indoors.
Police negotiators were called in, but officers are yet to find the man.
So far there have been no reports of injuries.
Police asked people in Mackay to avoid the downtown area until further notice.
People inside the declared zone have been urged to seek shelter in a secure place.
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