Ramallah, Feb 23 (IANS): The Palestinian National Authority (PNA) plans to develop a natural gas field off the Gaza Strip coast at a cost of $1 billion, a PNA minister said Monday.

Mohamed Mustafa, minister of economy, said in an emailed press statement that British Gas Co. and the Palestinian unity government will work together on developing the gas field, Xinhua news agency reported.

A large field of natural gas was discovered in early 2000 off the coast of the Gaza Strip by British Gas. A deal was signed between the company and the PNA to produce gas and help the PNA improve its finances.

Mustafa, also deputy prime minister of the Palestinian unity government, stated that the project needed international political guarantees to make Israel committed to the agreement.

The gas field is aimed at generating power and serve industry to create new financial resources, said Mustafa.

Since its establishment in 1994, the PNA has been financially depending on international donations and the tax revenue dues Israel collects on its behalf and pays them back to its budget.

However, the PNA has been going through a crucial financial crisis after Israel withheld the tax revenue dues to punish the Palestinians after they decided to join 20 international treaties and agencies, including the Rome Statute of the International Criminal Court.

Mustafa said annual cost for energy import had reached $2 billion and that "such a huge budget exhausts the Palestinian economy and that generating energy would save lots of money".