The Prime Minister's Office said Thursday it has not signed off on a Jordan Valley project that would create a new settlement in Maskiot, even though the Defense Ministry approved plans this week for a 20-home building project there. Defense officials cautioned that a second approval from the ministry was needed before construction could start in the over-the-Green Line community. The Prime Minister's Office also has to agree before the project can move forward. However, one IDF source said approval could now be retroactively granted for the six modular homes illegally placed there in November 2007 by families evacuated from the former Gaza settlement of Shirat Hayam. Jordan Valley Regional Council head Dubi Tal said the modular homes were still unauthorized but that he would work now on getting them permits. Located behind a hill and off of a rural road, Maskiot housed only a small Orthodox pre-military academy until the arrival of the Shirat Hayam families, the first of whom came early in 2007 and settled in two empty structures belonging to the school. Although the site has been designated as a settlement since the mid-1980s, it has only been used for educational purposes and no permanent community had ever been established there. The Shirat Hayam project was given initial approval by then defense minister Shaul Mofaz and prime minister Ariel Sharon in the fall of 2005. In December 2006, then-defense minister Amir Peretz tried to give the project its final set of authorizations, but changed his mind after the international community, including the United States, condemned the move. Palestinians and the United Nations on Thursday spoke out against the community. Palestinian Authority negotiator Saeb Erekat accused Israel of undermining US-backed peace talks with the latest settlement plan. "This is destroying the process of a two-state solution," Erekat said. "I hope the Americans will make the Israelis revoke the decision. I think they can make the Israelis do this." The US Embassy had no comment, but the office of UN Secretary-General Ban Ki-moon said he was "deeply concerned" about the Maskiot proposal. "The secretary-general has stressed many times before that settlement construction or expansion is contrary to international law and Israel's commitments under the road map and the Annapolis process," Ban's office said in a statement. In a visit to Israel and the West Bank last month, US Secretary of State Condoleezza Rice criticized settlement building as having "the potential to harm the negotiations." Peace Now said the fact that Maskiot had long existed as a settlement on paper was a technicality and that any move to place families there on a permanent basis was tantamount to the creation of a new settlement. On Thursday night the organization sent a letter to Defense Minister Ehud Barak in which, according to Peace Now secretary-general Yariv Oppenheimer, it wrote that "building in Maskiot is against the commitment of the government not to establish any new settlements and not to expand existing ones." Defense officials disputed the claim, explaining that it had been a settlement with buildings since the 1980s and the only thing that was happening was that more buildings were being added. Prime Minister Ehud Olmert's spokesman Mark Regev would not comment specifically on Maskiot. But, he said, "Israel will abide by all our commitments and there will be no new settlements and no outward expansion of existing ones." Still, council head Tal was cautiously optimistic. "We've moved forward by another millimeter," he said. AP contributed to this report.