ELI, West Bank (AP) – Jewish settlers are illegally building 27 mobile homes in this West Bank enclave with the knowledge of the Israeli government, officials said, despite Israel’s pledge to abide by an internationally endorsed peace plan that calls for a halt to all settlement activity.

The construction in Eli, 10 kilometers (6 miles) south of the Palestinian city of Nablus, is the latest Israeli building project to fuel friction with the Palestinians as the two sides try to end their decades-old conflict. Peace talks resumed in late November after a seven-year breakdown.

The trailers stand on a rocky, wind-swept hill in this settlement of 3,000, established almost 24 years ago. Buckets of paint and piles of drywall, ceramic tiles and cinderblocks, protected by blue plastic sheeting, were stacked up on the dirt road outside, as workers toiled to get the trailers ready for people to move in.

Settlement director Dovi Odeser insisted the new homes, funded by private Israeli and foreign investors, were being built within an existing neighborhood under an approved zoning plan. “We did not deviate in any way,” Odeser said. But Capt. Zidki Maman, spokesman for the military unit that oversees civil affairs in the West Bank, said that was not true. “There’s no zoning plan there. There’s no building permit,” he said.

The Defense Ministry, which oversees all settlement activity, is aware of the illegal construction and “is working on it,” he said.

“In the end, all illegal building is taken care of,” Maman said. He declined to say whether the trailers will be dismantled. “I don’t want to predict how it will end,” he said.

Last week, The Associated Press reported similar unauthorized settlement activity in Maskiot in the northern Jordan Valley. The military has issued orders to raze seven homes that were built illegally, Maman said. He had no information on when the demolition might be carried out.

The renewed peace talks, launched at a U.S.-hosted conference last November, are based on the 2003 “road map” peace plan, which obliges Israel to cease all settlement building.

Palestinian officials have repeatedly claimed that Israeli construction in Jewish settlements is undermining the talks. Israeli Prime Minister Ehud Olmert has announced a partial construction freeze, saying no new settlements will be built. But he has permitted construction in existing settlements to continue.

“The situation on the ground is deteriorating,” Palestinian negotiator Saeb Erekat told a news conference Wednesday, a day after Olmert and Palestinian President Mahmoud Abbas held their latest in a series of regular meetings.

Asked about the construction in Eli, Olmert spokesman Mark Regev said the Israeli government “is committed to its obligations on the issue of settlement.” “There will be no new settlement construction, and there will be no outward expansion of existing settlements,” Regev said. He did not say what action, if any, would be taken in Eli.

Despite repeated pledges, the Olmert government has done little to halt rogue settler activity. Israel has pledged to take down some two dozen wildcat outposts throughout the West Bank, but has taken action in only one outpost, removing nine unfinished homes in 2006.

The Palestinians hope to establish their state in the West Bank, Gaza Strip and east Jerusalem, areas Israel captured in the 1967 Mideast war. The Palestinians are also angered over Israeli plans to build thousands of new apartments in Jewish neighborhoods of east Jerusalem.

Israel annexed east Jerusalem after capturing it, and built new neighborhoods there that are home to 180,000 Israelis. Because of the annexation, it does not consider construction there to be settlement activity, though the Palestinians and international community do.

Israel is expected to retain its east Jerusalem neighborhoods in a peace deal, but the Palestinians still see construction there as compromising a final agreement. The road map also requires the Palestinians to dismantle militant groups. Abbas says he has cracked down on militants in his West Bank stronghold. But Israel says he has much further to go. Earlier this month, militants from the West Bank carried out a suicide bombing in southern Israel, and the violent Islamic Hamas has controlled the Gaza Strip since last June.

Olmert and Abbas have set a December 2008 target for reaching an accord, though Israel has cautioned no accord would be implemented as long as Hamas retains control of Gaza.

Erekat said Abbas and Olmert agreed Tuesday to begin working with a U.S. mediator in charge of investigating complaints about noncompliance with the road map. There was no Israeli confirmation.

Because of friction in peacemaking, a senior Palestinian official suggested Wednesday that his people follow Kosovo’s example and unilaterally declare independence if peace talks with Israel fail.

“Kosovo is not better than Palestine,” said Yasser Abed Rabbo, a close aide to Abbas. “If the whole world, the United States, the European Union, the majority of its states, have embraced the independence of Kosovo, why shouldn’t this happen with Palestine as well?”

Abbas said the proposal was premature and pledged to keep negotiating until the end of the year.

U.S. State Department spokesman Sean McCormack said unlike Kosovo, the Palestinians were still involved in peace negotiations. “We believe that there is hope in that process. It has not run its course,” he said. The Palestinians declared independence before, in 1988, but the international community did not recognize the declaration, and the Palestinians did not set up a state.