The rebel National Transitional Council, NTC, also offered an amnesty for anyone within Kadhafi’s inner circle who delivers him.
The leaders whereabouts are unknown, but rebels say they believe he is still in - or near - the capital, Tripoli.
Britain’s Defence Minister Liam Fox told the Sky television news channel that Nato is helping in the hunt for Kadhafi. He said the organisation is contributing intelligence and reconnaissance.
The Daily Telegraph newpaper also reports that elite SAS special forces members were sent to Libya several weeks ago and played a key role in the battle for Tripoli. According to the newspaper their mission now is to help find Kadhafi.
The Minister of Defence refused to comment on the reports.
Meanwhile, the United States is seeking agreement at the United Nations Security Council to unlock the Libyan state funds to provide humanitarian aid as the country's rebels move closer to total victory against Kadhafi’s regime.
The funds were frozen under UN resolutions after Kadhafi launched a crackdown on an anti-regime revolt in February.
But South Africa insisted in talks at the UN on Wednesday that the council wait for
the African Union to decide whether to recognise the rebel NTC at a summit later on Thursday before approving the US move.
If there is a deadlock, the US says it will seek a Security Council vote on the issue.
And Libya's rebels were recognised on Wednesday by two of Kadhafi's strongest African allies, Chad and Burkina Faso. Burkina Faso has offered exile to Kadhafi.
Ethiopia also recognised Libya's rebels yesterday and urged the African Union to do the same.
And Russian President Dmitry Medvedev said Russia would recognise the Libyan rebels if they "unite the country".
But Medvedev warned that Kadhafi still retained influence.