Lebanon PM approves expansion of area claimed in maritime dispute with Israel

BEIRUT (Reuters) - Lebanon's caretaker prime minister on Monday approved a draft decree expanding the country's claims in a dispute with Israel over their maritime border that has held up hydrocarbon exploration in the potentially gas-rich area.

Hassan Diab signed off on the document after both the minister of public works and the minister of defense earlier agreed to it.

The amendment would add around 1,400 square km (540 square miles) to the exclusive economic zone claimed by Lebanon in its original submission to the United Nations.

The draft decree relating to the amendment of the initial decree 6433 of 2011 has now been referred to the presidency for approval ahead of a request to the United Nations for a formal claim to register the new coordinates for the maritime zone.

Negotiations between old foes Lebanon and Israel were launched in October to try to resolve the dispute, yet the talks, a culmination of three years of diplomacy by the United States, have since stalled.

"I expect it (the decree) will be signed as everyone, the minister of defence and the prime minister and the president, are concerned about this," minister of public works Michel Najjar told a news conference earlier on Monday.

Israel already pumps gas from huge offshore fields but Lebanon has yet to find commercial gas reserves in its own waters.

Israeli Energy Minister Yuval Steinitz said Lebanon's latest move would derail the talks rather than help work towards a common solution. "Unilateral Lebanese measures will, of course, be answered with parallel measures by Israel," he said in a statement.

Lebanon, in the throes of a deep financial meltdown that is threatening its stability, is desperate for cash as it faces the worst economic crisis since its 1975-1990 civil war.

"We will not give up any inch of our homeland or a drop of its waters or an inch of its dignity," Najjar said.

(Reporting by Maha El Dahan; Additional reporting by Dan Williams in Jerusalem; Editing by William Maclean and David Holmes)