Fighters loyal to Libya's new leaders have thrust deep into the city of Sirte and into desert oasis Bani Walid, two of fugitive Muammar Gaddafi’s few remaining bastions, according to reports.

Columns of National Transitional Council fighters backed by tanks launched an early morning assault on Sirte, Gaddafi’s hometown on the central Mediterranean coast, a day after a first attack was repulsed.

Heavy fighting ensued at the airport and southeast of the city centre.

Earlier fighters for the NTC said they had captured a valley leading to the centre of Bani Walid.

The desert town of Bani Walid, 180km south of Tripoli, has been under siege for two weeks, with hundreds of die-hard Gaddafi loyalists concentrated at its centre.

However a spokesman for Gaddafi claimed they had inflicted heavy losses on NTC troops and said they were prepared for a long fight.

The spokesman was speaking in a broadcast aired on a Syrian-based television station.

"We have cleared the valley leading to the city centre," anti-Gaddafi fighter Talal Fernan said. Other fighters confirmed this.

"We are telling you that as of tomorrow there will be atrocious attacks by NATO and their agents on the ground on the resisting towns of Sirte, Bani Walid and Sabha," Moussa Ibrahim told Arrai television late yesterday.

Arrai said 16 people had been killed in Sirte, including women and children, as a result of NATO bombing, and that Gaddafi forces had destroyed a NATO warship and several vehicles. None of the reports could be independently verified.

In Tripoli, Turkey's prime minister Tayyip Erdogan arrived, a day after the French and British leaders won a hero's welcome there for helping to overthrow Gaddafi.

UN gives Libya's seat to transitional council

Meanwhile the United Nations has eased sanctions against Libya and gave the country's UN seat to the former rebel government which is currently trying to establish rule in the country.

Western nations who were at the forefront of the push for sanctions and help for the rebels battling Gaddafi, hailed the "historic" double breakthrough for the interim government on the international stage.

The 15-member Security Council unanimously passed a resolution to ease an assets freeze and arms embargo against Libyan companies and the government. It maintained sanctions against Kadhafi and a no-fly zone which has been used to justify NATO air strikes against Kadhafi targets.

Security Council resolution 2009 also set up a UN mission to go to Libya to help the interim government to arrange elections and write a new constitution.