If it's slightly proud or flush with the block and you can get there, then do like Pilkie says. The heat of the welding and the subsequent contraction as it cools often allows you to turn it out with your fingers once it cools.
If it's sub-surface and the bit is broken, then you will need a centre punch, a hammer and lots of patience, plus neighbours/family that are swearing tolerant.
Lots of lining up and bashing on the edge of the flutes will either loosen it or break it up and then you can get it out using surgical clamps or small needle nosed pliers.
Then, you need to carefully centre the next drill and start with the smallest one you are comfortable with and reqular squirts of Q-20 or similar to lube and cool it, keep it as square to the block as you can, because if you drill through the side of the bolt it becomes a ball-ache to turn it out the block later and will require possible Helicoiling. Work your way up in steps until you are half the diameter of the bolt, and if you can get them use Left Hand twist bits because the heating and squirts of oil should have loosened it to the point where the act of drilling will turn it out all by itself. If you don't have a LH bit, then an Eezi-out will do the job with a bit more cursing for good measure.
Remember, Eezi-outs are hardened so they can work, but that makes them brittle like drill bits. Have a read of this...
http://www.brokentap.com/easy-outs.html
If all else fails, then you have this to fall back on, but it will be egine out and stripped down.....
http://en.wikipedia.org/wiki/Electrical_discharge_machining