British gas giant BG Group is close to signing a deal that will see Palestine supply gas to Israel.
The historic agreement is believed to be worth $4 billion over 15 years, and will net Palestine royalties of $1 billion.
"We are making progress," said Nigel Shaw, BG Group Regional Vice-President. "There are commercial issues to be completed and we also require bilateral agreement between the two governments to get this project across the line. But this is a chance for greater economic prosperity in Palestine and that is only good for peace," he added.
Palestine's Gaza Marine gas field was discovered off the coast of Gaza in 2000. It is believed to hold one trillion cubic feet of gas.
A team of executives from BG Group are meeting a team of Israeli negotiators next week with the aim of concluding a deal.
As recently as last year, the thought of such a deal would not have been contemplated. At the time, BG Group was poised to sign a deal to export gas from the Gaza Marine field to Egypt when British Prime Minister Tony Blair intervened and asked the company to speak again to the Israelis.
According to a report in today's The Times newspaper in Britain, there are still several hurdles to be overcome, not least how payments to the Palestinian government will be made. Israeli defence authorities insist that no money goes directly to the Hamas-led government, and instead wants to pay for the gas in goods and services.