Pakistani officials said Thursday they have a "high-value target" in the war on terror surrounded near the Afghan border and sources reported that an air strike was being launched to flush out the resistance.

Intelligence officials suggest it may be Ayman al-Zawahri (search) — the Al Qaeda No. 2 leader and the top deputy to Usama bin Laden (search) — but the person's identity remains uncertain.

Hundreds of troops and paramilitary rangers pounded several fortress-like mud-brick compounds with artillery and fired on them from helicopter gunships, as entrenched suspects fought back hard in the mountainous region. An intelligence official said "dozens" were killed Thursday.

The officials told The Associated Press that intelligence indicated the forces had surrounded the Egyptian-born al-Zawahri in an operation that began Tuesday in South Waziristan, a semi-autonomous tribal belt long believed the most likely hiding place for the top two Al Qaeda leaders.

There was no indication bin Laden was with al-Zawahri. However, the two have traveled together in the past, and bin Laden and al-Zawahri appeared jointly in video tapes released shortly after the Sept. 11, 2001, attacks on the United States.

"We have been receiving intelligence and information from our agents who are working in the tribal areas that al-Zawahri could be among the people hiding there," a Pakistani military official said. "All of our efforts are to capture him."

An intelligence official and a senior politician in President Gen. Pervez Musharraf's government both confirmed the account. All spoke on condition of anonymity.

The intelligence official said information was also coming from some of the 18 suspects arrested during Thursday's operation. Some said during interrogation that al-Zawahri was wounded in the raid, the official said. Officials said helicopter gunships and artillery would continue attacking at dawn Friday.

A senior counterterrorism official told Fox News it is believed to be al-Zawahri because of  "multiple specific pieces of intelligence" gathered.

Pakistani journalist Hamid Mir told said the Pakistani military has "already sent some choppers to that area. They will strike all those bunkers from where the Al Qaeda fighters are fighting against Pakistani forces."

Maj. Gen. Shaukat Sultan (search), spokesman for the Pakistani military told Fox News the reports that the cornered individual is al-Zawahri are purely speculative, but confirmed that "the militants are very well dug in" and the resistance is "unusually strong."

"This is not a small area," he said. "The area has been effectively surrounded by the troops and we are making all the effort to ensure people do not slip out during the night."

Responding to reports a military strike was in the works, Sultan said: "We have all kind of support lined up ... if required, it is going to be used."

"We would make all the effort to cap people alive, if not, effort would be made to flush them out whether alive or dead."

'He's a Whale'

White House Communications Director Dan Bartlett (search) told Fox News there is no confirmation as to who is cornered, but if it is al-Zawahri "it would be a significant victory in the war on terror. When you're talking about big fish, he's a whale."

The United States has offered a $25 million reward for information leading to al-Zawahri's capture.

Mansoor Ijaz, Fox News' foreign affairs analyst, said capturing al-Zawahri would be "bigger than Usama bin Laden" because of his mastery in planning and coordinating deadly terrorist attacks and ability to link Al Qaeda cells around the world.

Musharraf said in a television interview he had spoken with the commander of Pakistani troops in the region. He said the commander reported "fierce resistance" from a group of fighters entrenched in fort-like buildings and there were indications that a senior figure was surrounded.

"He's reasonably sure there's a high-value target there," Musharraf said.

Pakistan Military Pursues Tribal Leaders

The Pakistani military has been pursuing 100 tribal leaders that authorities want to roll into their efforts to hunt Al Qaeda in the Waziristan frontier. So far, about two-thirds have said they would provide information and turn over any Islamic militants in their territories, American defense officials said on condition of anonymity.

The Pakistanis also are targeting Arabs and other foreigners who settled in the tribal regions shortly after the Afghan-Soviet war in the 1980s, the officials said. While some veterans of the war formed the nucleus of Al Qaeda, others put down roots in Pakistan.

It is believed that some of these veterans are providing a support network for bin Laden and his followers in the region, officials said.

U.S. officials say they are watching to see if the Pakistani actions send militant fighters moving back to Afghanistan, where U.S. troops operate freely.

Hundreds of Pakistani troops have moved into three South Waziristan towns — Azam Warsak, Shin Warsak and Kaloosha — firing artillery and using helicopter gunships against entrenched positions.

Early morning calls from mosques warned residents in those towns to leave the area, apparently to give the troops more room to operate.

At least 41 people — including 15 soldiers and 26 suspected militants — were killed Tuesday in fighting in the area, and Sultan said there were an unknown number of casualties in continued action Thursday.

The military said Thursday that most of those killed were foreigners, but it did not give their nationalities and acknowledged that only two bodies had been recovered.

The two dead were believed to be a Chechen and someone of Middle Eastern origin, a military official said on condition of anonymity.

Powell Praises Pakistan for Terror War Help

The news came the same day as Secretary of State Colin Powell (search) announced in Islamabad that Washington was bestowing the status of "major non-NATO ally" on Pakistan and praised it for its help in the war on terror.

Musharraf, a key ally in the U.S.-led war on terrorism, promised Monday to rid the tribal areas of foreign terrorists.

Powell, who left the country hours before the announcement, also said he believed there was evidence that bin Laden is still alive and hiding in the rugged border area.

"No one has seen him, so how can one be sure?" Powell told Geo TV. "But he has certainly given evidence that he is alive and active. But we can't be sure.

"And if he is alive and active, and the evidence suggests that he is, and if he is in the area of the Pakistan-Afghan border, that's a very difficult area to find someone who doesn't want to be found."

A spokesman for the U.S. military in Afghanistan told AP the force hoped Pakistani soldiers had indeed cornered al-Zawahri, but he had no new information on the whereabouts of either of the Al Qaeda leaders.

"All the senior leaders of Al Qaeda will be brought to justice," Lt. Col. Bryan Hilferty said.

Hilferty said a U.S. operation begun March 7 on the Afghan side of the border was continuing, but he gave no details and said he had no information of any signs of militants fleeing from Pakistan.

About a dozen helicopters buzzed over Wana, the main town in South Waziristan, early Thursday, flying toward the operation zone about six miles to the west.

A convoy of army trucks carrying soldiers also passed Wana hours before the operation started. Later, mortar explosions were heard in the town.

Interior Ministry spokesman Abdur Rauf Chaudhry said extra troops were dispatched in anticipation of the new offensive.

He said "a few" paramilitary troops are missing from Tuesday's operation in Kaloosha, with rumors in the region that they may have been kidnapped by the suspected militants.

The raid has sparked outrage in the tribal region, which fiercely covets its autonomy and has resisted outside intervention for centuries.

In another part of the tribal region, North Waziristan, attackers launched a rocket and fired gunshots at a Pakistan army post before dawn Thursday, Sultan said. Two soldiers died and several were injured in the attack, an intelligence official told the AP on condition of anonymity.

The official also said assailants threw a hand grenade at an army truck heading to Miran Shah, North Waziristan's main town, and that several soldiers were injured. But Sultan denied the incident occurred.

The Associated Press contributed to this report.