Speaking on condition of anonymity, officials told the AP news agency that Yemeni Prime Minister Ahmed Obaid Bin Daghar is about to flee the country as Southern Transitional Council (STC) militants entered the presidential palace in Aden.
The statement came amid the ongoing fierce clashes between two former allies, pro-government forces and STC militants, which erupted after Yemen's internationally recognized government failed to meet a deadline to resign.
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Late last week, more than twenty people were killed in the clashes as supporters of a movement to restore South Yemen's independence from the North reportedly captured several government facilities.
President Abdrabbuh Mansour Hadi, who was earlier backed by STC militants, has accused them of trying to stage a coup. He is currently under pressure by South Yemen to replace both the Prime Minister and parliamentary cabinet.
Hadi previously fled from advancing Houthi militants to his hometown of Aden, and alongside the Saudi-led coalition helped push the Houthis away from southern regions.