CAIRO (AFP)

Egypt will become the main supplier of electricity to the Hamas-run Gaza Strip, which now depends mainly on Israel for its power supplies, the Egyptian newspaper Al-Ahram said on Friday.

"Egypt has decided to implement a project aiming to increase its provision of electricity to the Gaza Strip from 17 to 150 megawatts, in order to give relief to the Palestinians," the pro-government newspaper said.

It did not say when this would start.

The impoverished Strip, home to some 1.5 million Palestinians, is currently at the mercy of the Jewish state for its energy supplies and has been submitted to electricity cuts and a tight blockade since Hamas seized power last June.

A senior official from Egypt's electricity ministry, cited by the daily, said the Islamic Development Bank had agreed a loan of 32.5 million dollars to finance the project which would link the Egyptian town of El-Arish, in Sinai, with Gaza.

At present, a power line from Egypt provides Gaza with between five and 10 percent of its electricity needs, following a June 2006 agreement with the Palestinians aiming to cut their dependence on Israel.

In normal times, Israel provided nearly 120 megawatts to Gaza, which since 2004 also relied on the Jewish state for vehicle fuel supplies and fuel to feed their sole 140 megawatt power plant.

But since the Islamist movement Hamas seized the Strip, Israel reduced its fuel supplies and imposed power cuts in retaliation for Palestinian rocket attacks in the south of the country.

Al-Ahram said that Egyptian Oil Minister Sameh Fahmi has issued "urgent" directives for his country to provide natural gas as quickly as possible to Gaza.

He was also reported as saying Cairo would help develop Palestinian gas fields discovered offshore from Gaza, after meeting Omar Kittaneh, the Palestinian Authority's official responsible for energy and natural resources.