The days of calm that prevailed during negotiations shattered in one of Moammar Gadhafi's last bastions as loyalists fired on advancing opposition fighters, a chief interim council negotiator told CNN Thursday.
Meanwhile, a spokesman for the new Tripoli Military Council said Gadhafi is cornered and has no means of escape.
Anees Al-Sharif would not divulge the fugitive leader's location, saying only that Gadhafi was surrounded within a radius of 60 kilometers (37 miles) with no way of leaving the area.
The anti-Gadhafi fighters were on a reconnaissance mission when they came under fire in Wadi Dinar, about 15 kilometers (9 miles) outside Bani Walid, said Abdallah Kenshil, a National Transitional Council member who is negotiating with tribal leaders in Bani Walid for a loyalist surrender.
Kenshil said Gadhafi and his sons, two of whom have been spotted by Bani Walid residents, were attempting to derail the peace talks.
"We know that Saif al-Islam Gadhafi and Mutassim Gadhafi are inside Bani Walid," he said. "Eyewitnesses we know by name inside Bani Walid told us they saw them."
Libya's new leaders have imposed a Saturday deadline on Gadhafi loyalists in the town to lay down their arms or face military force.FULL STORY