UPDATE 1-Preferably dead: Duterte offers cash for capture of freed Filipino felons

* Duterte 'prize' of a million pesos for catching convicts
* Says 'dead or alive', but dead may be 'a better option'
* Remark shouldn't be taken literally - justice minister
* Violent offenders freed in corrections bureau blunder
* 'He throws grenades' - Duterte defends new prisons boss

(Adds justice secretary comment paragraph 7-9)
MANILA, Sept 18 (Reuters) - Philippines President Rodrigo
Duterte has offered big bounties for hundreds of convicted
murderers and rapists set free in a corrections bureau blunder -
and said he would be happier if they were caught dead rather
than alive.
The release under a good-behaviour reward programme of more
than 1,700 criminals guilty of mostly violent offences has been
a huge embarrassment for a crime-busting leader elected almost
entirely on promises to make the streets safer. Duterte said there was a "prize" of a million pesos
($19,175) for tracking down each convict still at large, after
less than 700 of them heeded his call for their surrender.
"The one million prize is available to those who can capture
them dead or alive. But maybe dead would be a better option. I
will pay you smiling," he told reporters late on Tuesday.
Duterte is a former mayor and prosecutor who boasted he
would kill as many as 100,000 criminals if be became president.
Since his election he has become known for a bloody "war on
drugs" during which police have killed thousands of mostly urban
poor dealers and users. Activists say many of the killings were
executions, but police deny this. His latest remarks are likely to outrage opponents who
accuse him of deliberately inciting vigilantism. His office
rejects that and says his tough talk is endearing him to
millions of Filipinos.
However on Wednesday, Justice Secretary Menardo Guevarra
appeared to row back from Duterte's bounty offer.
"'Dead or alive' should not be taken literally," he said.
"Law enforcers are supposed to effect peaceful arrests, but
they may use reasonable force if the subject of the arrest
violently resists."
The good conduct law was passed under Duterte's predecessor
to try to reduce the populations of some of the world's most
crowded jails.
More than 21,000 inmates were released, but justice
department officials say more than 2,000 of them were sentenced
for crimes like rape, drugs, murder, bribery, plunder,
kidnapping and arson, and were therefore not eligible for
release.
Some 1,700 of them were freed by a corrections bureau run by
Duterte's appointees, two of them staunch loyalists. One of
them, Nicanor Faeldon, was sacked after it emerged that nearly
900 serious offenders were freed on his watch. Faeldon denies
wrongdoing.
Duterte defended the appointment on Tuesday of a new
corrections bureau boss - a prison chief for whom prosecutors
have sought homicide charges.
Gerald Bantag ran a Manila jail where in 2016, a grenade
explosion killed 10 inmates, most of them drug offenders. A
court has yet to take up the case.
"I don't think that he did it. If he did, then he might be
convicted," Duterte said.
"But in the meantime, I like him because I heard he throws
grenades," he added.