Libyan rebels pushed toward Muammar Qaddafi’s hometown of Sirte amid protests over the opposition National Transitional Council’s planned appointment of former members of his security forces.

As anti-Qaddafi forces waited for the North Atlantic Treaty Organization to bomb Scud missile sites so they can move toward Sirte, about 500 protesters in the rebel-held city of Misrata yesterday chanted the “blood of the martyrs” would be betrayed by the expected appointment of former army general Albarrani Shkal as head of security in the capital, Tripoli.

“Shkal is with Qaddafi,” said the president of Misrata Council, Sheikh Khalifa Zuwawi. “Not long ago he was using troops to shell people in Misrata.”

The rebels have been trying to find Qaddafi and his closest aides, consolidate their gains and bring stability to the North African nation since entering Tripoli last week. The group expects to announce a new interim government, led by current prime minister Mahmoud Jibril, in the first week of September, NTC member Fathi Baja said by telephone today.

Sirte is a haven for Qaddafi loyalists, according to the rebel command and NATO. His chief spokesman, Moussa Ibrahim, said Aug. 27 that Qaddafi remains in Libya and wants to negotiate with the rebels to form a transitional government, an offer that opposition leaders have rejected.

Qaddafi Officials

According to Baja, Qaddafi loyalists in Sirte have two options: “To speed up the negotiations process and accept the liberation of Sirte, or to face the military solution,” he said. As for Qaddafi strongholds, “our plan is that Qaddafi and his loyalists won’t be there until Sept. 1,” Baja said.

Salim Miftah, one of the rebel commanders told Al Jazeera the rebels need about 10 days to capture Sirte if talks fail.

Residents in Misrata say they oppose allowing Qaddafi government officials to take key security jobs.

“I can’t see any justification whatsoever,” said Hassan Al Amin, who returned to Misrata from 28 years of exile in the U.K. “We have a big force in Tripoli, they are not going to follow orders from a war criminal.”

At least four Scud missiles have been launched from Sirte at the opposition stronghold of Misrata over the past two weeks, Abdullah Maiteeg, a rebel fighter, said in an interview. Rebel units pushed toward Sirte from east and west along the coastal highway yesterday, Commander Ali Ahmed of the rebel Sidra Brigade said in an interview.

Al-Megrahi Found

NATO targeted 20 surface to air missile canisters and two surface-to-air missile systems in Sirte overnight, as well as five multiple rocket launchers in Ras Lanuf, home to one of Libya’s biggest refineries, NATO said in statement today.

“Fierce clashes” have also erupted in Sabha, Baja said today. A group of tribal leaders from Bani Walid asked yesterday to start talks with the rebels to “surrender and recognize the revolutionaries and the revolution,” Baja added.

The transitional council officially transferred its headquarters to Tripoli from Benghazi, in the east, on Aug. 24.

Abdel-Baset al-Megrahi, who was convicted of the 1988 Lockerbie bombing, was found lying in a comatose state and close to death in his Tripoli home, CNN reported. The Libyan rebel government won’t deport al-Megrahi, its justice minister said, according to the Associated Press. U.S. Senator Charles Schumer, Democrat of New York, had encouraged the rebel council to hold al-Megrahi fully accountable for the bombing of Pan Am flight 103, which killed 270 people.

Justice Minister Mohammed al-Alagi told reporters in Tripoli that the request had “no meaning” because al-Megrahi had already been tried and convicted.

Domestic Concerns

Al-Megrahi spent almost nine years in prison in Scotland until he was released in 2009 for health reasons. The Scottish municipality responsible for monitoring al-Megrahi said officials are in contact with his family and there is “no evidence of a breach of his license condition,” a statement from East Renfrewshire Council and the Scottish government said today.

With Tripoli under their control, the rebel leaders are turning to domestic concerns including a water shortage and spread of disease.

The United Nations Children’s Fund said it expected to deliver more than 110,000 bottles of water to Tripoli by yesterday.

‘Extremely Concerned’

“We remain extremely concerned about the situation,” Christian Balslev-Olesen, head of the Unicef office in Libya, said. “This could turn into an unprecedented health epidemic.”

The opposition council claimed full control of Libya’s oil fields. Nouri Balroin, the head of the NTC’s oil production unit, said output will resume within three weeks, Al Jazeera reported yesterday.

Oil experts will follow a three-stage plan to restore the flow of oil to 1.6 million barrels a day within 15 months, he said, according to the Qatar-based network. Ras Lanuf refinery is able to restart operations at any time, Al Arabiya reported, citing the director of the facility.

The conflict has all but halted oil exports from Libya, which has the largest proven reserves of any African country. Output dropped to 100,000 barrels a day in July, down from the 1.6 million barrels pumped before the uprising started.

Crude oil for October delivery rose 3 cents to $85.40 a barrel on the New York Mercantile Exchange at 11:03 a.m. London time. Brent oil for October settlement dropped 33 cents to $111.03 a barrel on the London-based ICE Futures Europe exchange.

Evidence of atrocities emerged at a former military base, where the handcuffed bodies of 130 Libyan rebels and the remains of 20 civilians were found, a Libyan activist and journalist in Tripoli, Numedia al-Trabulsi, told Al Jazeera in a telephone interview Aug. 27.

The bodies were found in the Khamis Camp in Tripoli, now under rebel control. The Khamis Brigade is a special forces military unit led by Qaddafi’s youngest son, Khamis.

Amnesty International said it has uncovered evidence that loyalist forces killed detainees at two military camps in Tripoli on Aug. 23 and 24.

To contact the reporters on this story: Christopher Stephen in Libya at cstephen9@bloomberg.net.