Libyan rebels closed in on Moamer Kadhafi's hometown of Sirte from both east and west, a senior military commander said, as the insurgents scrambled to restore essential services to Tripoli.
Fierce fighting also raged in the west of the country as rebels trying to take full control of the region said they had fallen into an ambush in a town southwest of Zuwarah.
Rebel forces moved to within 30 kilometres (18 miles) of Sirte from the west and captured Bin Jawad 100 kilometres to the east, the rebel commander in Misrata, Mohammed al-Fortiya, told AFP.
"We took Bin Jawad today" on the eastern front, and "the thwar (rebel fighters) from Misrata are 30 kilometres from Sirte" in the west, Fortiya said.
Rebels pushing west from the oil hub of Ras Lanuf had been stuck for four days outside Bin Jawad, a key town on the coast road of the Gulf of Sirte, as Kadhafi's forces kept up a defiant resistance.
Sirte is the elusive Kadhafi's last bastion after rebels smashed his forces in Tripoli and seized his Bab al-Aziziya headquarters.
Although his whereabouts remain a mystery, there is widespread speculation that he is holed up in Sirte, 360 kilometres east of Tripoli, among tribal supporters there.
"We are negotiating with the tribes for Sirte's peaceful surrender," Fortiya said, adding that only tribal leaders were involved, and that to his knowledge no direct contact had been made with Kadhafi himself.
But a spokesman for the rebel National Transitional Council (NTC), Mahmud Shammam, warned that negotiations for Sirte's peaceful handover would not be open-ended.
"The negotiations will not go on for ever," he said. "The talks are still going on... We would like to unify Libya very quickly."
As rebels scrambled to get Tripoli back on its feet and appealed for funds, the Arab League early on Sunday urged the UN Security Council to unlock billions of dollars in Libyan assets and property.
Some 70 percent of homes in central Tripoli have no running water because of damage to the network, but potable water is being distributed from mosques, NTC officials said.
Abed al-Obeidi, deputy chief of the transitional council in Tripoli, said the water problem was because of technical faults, denying that sabotage by Kadhafi's forces was to blame.
In the rebel bastion of Benghazi, military spokesman Colonel Ahmed Omar Bani told reporters more than 10,000 prisoners have been freed from Kadhafi's jails since the fall of Tripoli but almost 50,000 others are still missing.
"The number of people arrested over the past months (of the anti-Kadhafi revolt) is estimated at between 57,000 and 60,000," he said. "Between 10,000 and 11,000 prisoners have been freed up until now... so where are the others?"
"We hope that Kadhafi is still in Libya so we can rid the world of this insect," he said. "The only way to treat this pest is to make him accountable for the crimes in Libya."
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NTC head Mustafa Abdel Jalil had promised on Saturday that Kadhafi and his senior aides would be given a fair trial if they surrendered.
"We call on Moamer Kadhafi and his associates to surrender so we can protect them and spare them illegal execution," he said in Benghazi. "We guarantee them a fair trial, whatever their position."
The rebels have offered a $1.7 million-dollar reward for Kadhafi's capture, dead or alive.
Rebel pleas for cash help were heard loud and clear at Arab League headquarters in Cairo where a special meeting of foreign ministers urged "the UN and countries concerned" to "unfreeze the assets and property" of Libya.
Dr Najib Barakat of a local rebel council for Tripoli said there were enough medical supplies for three or four weeks, and that some 60 percent of the capital's medical staff were at work.
"All of Tripoli's hospitals are working," Barakat said, except at Abu Slim where around 80 decomposing bodies had been found. "The bodies have been removed and the hospital is being disinfected."
Arab foreign ministers also called on the United Nations to give the NTC Libya's seat at the UN and its agencies.
NTC number two Mahmud Jibril, who headed the Libyan delegation at the Cairo gathering, warned of "instability" in Libya if the rebels failed to restore salaries and services.
On Sunday, insurgents expanded their control over the airport and other parts of Tripoli where some resistance remained.
They captured the base of the elite 32 Brigade, commanded by Kadhafi's son Khamis, on Saturday after a NATO air strike and seven hours of fierce fighting that left 11 rebels dead.
In an adjoining cinder-block building, an AFP correspondent saw the charred remains of some 50 people who residents said were captives killed by Kadhafi forces on Tuesday with rifle fire and grenades.
Bani said that Khamis, whose death has been announced several times since the conflict erupted, may have been killed in a clash with rebels on Saturday.
The incident happened at Tarhuna, 80 kilometres (50 miles) southeast of Tripoli when rebels "intercepted a military convoy which had several brand new Mercedes vehicles," he said.
In the ensuing firefight two vehicles in the convoy crashed and burned.
"It is very difficult to identify the charred bodies, but the soldiers captured on the spot told us that they were bodyguards of Khamis Kadhafi," Bani said.
"At the moment, we are unable to identify with certainty the occupants, but we will notify you once we have information."
A half dozen explosions were heard in the distance early Monday in Tripoli just after a NATO warplane flew over the Libyan capital.
The blasts were heard as rebels across the city celebrated their victory against the Kadhafi regime, firing automatic weapons into the air.
After the explosions, the joyful shooting by the rebels came to an abrupt halt for several minutes, bringing an unusual calm to Tripoli, before resuming more cautiously.