NTC fighters regrouped on Friday for a new assault on Moamer Gaddafi's hometown Sirte, remaining upbeat despite suffering heavy losses the previous day at the hands of the toppled tyrant's forces.

The fighting comes as Gaddafi's spokesman warned that "thousands" of loyalists were ready to battle the National Transitional Council combatants, while accusing France and Britain of scrambling to plunder Libya's riches.

The NTC military said 11 fighters were killed and 34 wounded in a first assault on Sirte launched before sunset on Thursday, and that 40 Gaddafi loyalists had been captured.

An AFP correspondent said NTC fighters were fired up on Friday as they regrouped along the Mediterranean coast ready for a new foray into Sirte, Gaddafi's most symbolic remaining redoubt.

"We are expecting more clashes with Gaddafi's forces, but we hope to take all of Sirte today," Salah al-Areg, a fighter with the Al-Wadi Brigade, told AFP.

The long-expected battle for the city began even as British Prime Minister David Cameron and French President Nicolas Sarkozy were being mobbed in Benghazi, bastion of the rebellion that toppled Gaddafi, and were hailing their historic visit to a "free Libya."

Overnight, Gaddafi's spokesman Mussa Ibrahim telephoned Syria-based Arrai television channel to boast that "thousands" of loyalists were ready to fight "on all fronts" and that victory over the NTC forces was assured.

Ibrahim also accused Britain and France of trying to colonize Libya and said the one-day flying visit by Cameron and Sarkozy to Tripoli and Benghazi was aimed at setting up a Western "fiefdom" in Libya.

"The visit marks the start of a project of colonization of Libya," Ibrahim charged.

"They are hurrying to collect the fruits of the fall of Tripoli... because they obviously fear the arrival of America and other countries wanting a slice of the cake," he said, without disclosing where he was phoning from.

Gaddafi and members of his inner circle have been in hiding since Tripoli was overrun late last month, with the fugitive strongman still believed to be in Libya even though members of his family have fled to Algeria and Niger.

"They hurried to Tripoli to make secret deals with the collaborators and the traitors, and to take the control of oil and investments under the pretext of rebuilding," Ibrahim said.

An AFP correspondent at Hassan, some 60 kilometres (35 miles) west of Sirte, said NTC forces had first gathered there to prepare for the day's fighting.

There were dozens of pick-ups bristling with anti-aircraft guns.

"There are many different katibas (brigades) here. This is a back point to refuel," Sadiq Fayturi, head of logistics of the Qabra Brigade, told AFP.

"Many of the katibas are about 20 kilometres south of Sirte in the villages of Jaraf and Egbeba."

Their task appeared to have been made easier by NATO air strikes.

NATO said that on Thursday its warplanes had struck one military storage facility, two armed vehicles, one tank, four multiple rocket launchers and eight air missile systems.

Around 15 percent of Gaddafi's forces are still operational, the alliance said.

Cameron and Sarkozy were welcomed in Benghazi as conquering heroes.

"It is great to be in a free Benghazi and in a free Libya," Cameron said as jubilant crowds cheered them, flashing V-for-victory signs.

"The people of Britain salute your courage."

"Your city was an inspiration to the world," Cameron added. "Colonel Gaddafi said he would hunt you like rats but you show the courage of lions."

Sarkozy said: "Friends in Benghazi we ask one thing. We believe in a united Libya, not a divided Libya."

"You wanted peace, you wanted liberty, you want economic progress. France, Great Britain and Europe will be on the side of the Libyan people," he said.

Before flying to Benghazi, Cameron at a joint news conference in Tripoli pledged help to bring the fugitive Gaddafi to book.

"We must keep on with the NATO mission until civilians are all protected and until this work is finished," he said.

"We will help you to find Gaddafi and to bring him to justice."

Sarkozy said the toppled despot remained a "danger" and that there was a "job to finish" in eliminating his forces' remaining strongholds.

Sarkozy also insisted there was "no ulterior motive" in Western assistance to the new Libya.

"We did what we did because we thought it was right," he declared.

Cameron and Sarkozy, whose forces spearheaded the NATO air war that helped topple Gaddafi, are immensely popular among ordinary Libyans for their role in ending the fugitive strongman's 42 years of iron-fisted rule.

In Tripoli, Cameron said Britain would release 600 million pounds ($950 million, 690 million euros) in Libyan assets as part of a series of measures aimed at supporting Libya's new authorities.

He also said Britain would release another 12 billion pounds in frozen Gaddafi regime assets as soon as the UN Security Council approved a draft resolution that Britain and France are to put forward on Friday.

Ibrahim in his overnight message to Arrai was disparaging of Cameron's comments.

"They speak now about the construction of Libya for hundreds of billions of dollars... they destroy it and rebuild it with the money of Libyans," he said.