Negotiations over the surrender of Muammar Gaddafi's stronghold, Bani Walid, appear to have failed and an attack on the Libyan town seems likely.
Two deadlines have passed and thousands of National Transitional Council fighters were on Monday massing outside the town, about 150km southeast of the Libyan capital, Tripoli.
There were also reports of a large convoy of Libyan armoured vehicles crossing into Niger.
A French military source and a Niger military source told the Reuters news agency that the convoy, escorted by the Nigerien military, arrived in the northern desert town of Agadez.
The convoy contained between 200 and 250 Libyan military vehicles and included officers from Libya's southern army battalions, and likely crossed from Libya into Algeria before entering Niger, the sources said.
The French military source said he had been told Gaddafi and his son Saif al-Islam might be considering joining the convoy en route to Burkina Faso, a landlocked West African state which has offered Gaddafi and his family asylum and has a border with Niger.
A Nigerien government source earlier said prominent regime officials had fled across the border.
They included Gaddafi's internal security chief Mansour Daw, who was earlier reported to be in Bani Walid with at least two of the toppled leader's sons.
Daw and some 10 others were brought across the border to Agadez by a top Tuareg leader allied to Gaddafi, Tuareg sources said.
It was not clear if they were part of the large military convoy.
As for the deposed leader, he is reportedly still in Libya. His spokesman Moussa Ibrahim said that Gaddafi "is in a place that will not be reached by those fractious groups, and he is in Libya."
Gaddafi is in good health and in good spirits, Ibrahim said in remarks broadcast on Monday. He said Gaddafi's son, Saif al-Islam, was also in Libya, moving around from one place to another.
Meanwhile, despite the lack of progress so far, negotiators for the NTC have not entirely given up hope for a bloodless resolution to the Bani Walid stand-off.
Al Jazeera's Andrew Simmons, reporting from near the town, spoke to some of those who have tried to seal a deal with the Gaddafi loyalists inside.
"They say they want to go step by step, and negotiate with the various tribes around Bani Walid before moving in. They want to end this peacefully," he said.
"But the chances of this happening remain unclear, as Gaddafi forces remain inside the town. They have many civilians around them."
The message varies widely from negotiator to negotiator, with some sounding more optimistic than others.
At a military checkpoint about 60km north of the town on the road to the capital, Abdallah Kanshil, who is conducting talks for the interim government, said a peaceful handover of Bani Walid was imminent.
A day earlier, he had said peace talks broke down after Gaddafi loyalists insisted the fighters put down their weapons before entering Bani Walid.
But on Monday, Kanshil said: "The surrender of the city is imminent. It is a matter of avoiding civilian casualties. Some snipers have surrendered their weapons ... Our forces are ready."
Similar statements have been made for days, however. In any case, 20km closer to Bani Walid, NTC forces have built a field hospital and installed 10 volunteer doctors to prepare for the possibility that Gaddafi loyalists will not give up without a fight.
Reporting from near Bani Walid earlier on Monday, Al Jazeera's Sue Turton said: "Fighters pushed to within seven kilometres of the centre of the town and exchanged fire with some of Gaddafi's forces.
"But they have since retreated a little bit instead of setting up a defensive position there."
Negotiations also continued for the surrender of Sirte, Gaddafi's hometown in the east of the country.
UK to examine spy ties
Against this backdrop of continued conflict, David Cameron, the British prime minister, said an inquiry into his country's pursuit of terrorism suspects will examine new allegations about cozy ties between UK intelligence officials and the Gaddafi regime.
Security documents discovered after the fall of Tripoli have offered embarrassing examples of the warm relationships that British and American spies had developed with their Libyan counterparts.
Files discovered among tens of thousands of papers collected from an External Security building in Tripoli show how Abdel-Hakim Belhaj, now Libya's rebel military commander, was targeted for rendition.
Belhaj, who was seized in Bangkok in 2004 and delivered to Tripoli, alleges that US and British intelligence planned his capture and were later involved in his interrogation.
Cameron said his country's special representative to Libya was moving to Tripoli on Monday to re-establish full diplomatic presence.
"Today the UK's Special Representative [John Jenkins] is deploying to Tripoli to re-establish our full diplomatic
presence," he told parliament.
He said Britain and its NATO allies would continue to implement UN Security Council resolutions for as long as they were needed to protect civilians. Britain was ready to extend the NATO mandate for as long as necessary, he said.
"We will not let up until the job is done," he said.
In another development, media reports on Monday suggested that Chinese arms firms had offered to sell weapons worth about $200m to Gaddafi's forces in July. While China's foreign ministry acknowledged that talks had taken place, it denied prior knowledge.