Any deal would represent a landmark in Middle Eastern relations, but BG said it would first require agreement between both governments.
"We have been in negotiation with
"Most importantly, we need a bilateral agreement between both governments to get the go-ahead on this. We are working on that."
BG, previously part of British Gas, is seeking a 15-year contract.
According to press reports, BG is hoping to sign a $4bn (£2bn) deal that would see the Palestinian Authority receive $1bn in royalties.
Under the proposals, BG would transport gas from the Gaza Marine field through an undersea pipeline to the Israeli
The field contains one trillion cubic feet of gas, and could reportedly supply 10% of
If the project gets the go-ahead it would be a major boost to the economies in the Palestinian controlled territories.
Ongoing violence, especially in the Gaza Strip, has seen much economic activity grind to a halt, leaving the territories heavily reliant upon financial aid from overseas. Published by BBC on May 23, 2007.