WASHINGTON D.C., Sept 14 (IslamOnline & News Agencies) - In a bid to diffuse the intensifying tension over Israeli threats against Lebanon after the latter began diverting water from a major shared body of water, a U.S. official is set to arrive in Israel early next week to mediate between the two countries, a senior U.S. official told news agencies Saturday.

Tensions have flared between the two countries during the past week over Lebanon's diversion of water from the Wazzani River, a tributary of the Hasbani, which flows from Lebanon into Israel.

Israeli Prime Minister Ariel Sharon warned Tuesday that any diversion of water from the Hasbani would constitute a "casus belli", or grounds for war, between the two nations.

The U.S official was due to arrive in Israel "within the next few days" to begin talks with both Lebanese and Israeli officials in a bid to resolve the dispute, the source said.

"We have been talking to both sides at the highest level - in Washington, in [Occupied] Jerusalem and in Beirut - trying to get both sides to come to a peaceful compromise solution," he said.

"This is a very serious matter for both countries."

Asked whether the official's visit had been organized because existing diplomatic efforts were failing, the source refused to comment.

"We believe the talks have been helpful but the issue is still of some concern," he said.

Lebanon started pumping water from the Wazzani River to two villages in March this year despite Israeli anger over the project.

Israel's anger stems from the fact that Hasbani supplies between 20 and 25 percent of the Sea of Galilee, Israel's main source of drinking water.

Speaking after a meeting with Deputy Secretary of State Richard Armitage Friday, Israeli Foreign Minister Shimon Peres described Lebanon's pumping from the Wazzani as an "unnecessary provocation".

But Lebanon insists the project is essential to provide drinking water to a total of 20 villages in the border region, which was occupied by Israel from 1978 to 2000.

Lebanon defied Israeli threats on Wednesday by speeding up works on a project to divert the waters of a river that flows into Israel to villages on the border.

"Despite the Israeli threats, I have received instructions today to speed up works in order to complete in the next 25 days the project to pump the waters of the Wazzani," contractor Ali Wehbe told Agence France-Presse (AFP).

"I will double the number of workers and bring in more equipment so that work accelerates," he said.

Wehbe said his private company, Ward, began work last month to install 10 miles (16 kilometers) of 16-inch (40 centimeter) wide cast-iron pipes to divert the waters of the Wazzani River to Taibe and other nearby villages.

The Wazzani has its source some 700 yards north of the Lebanese-Israeli border and flows one mile (two kilometers) to the west before joining the larger Hasbani River in Lebanese territory.

The Hasbani originates 12 miles (20 kilometers) further north and flows into the Sea of Galilee in northern Israel.

The project is set to provide 20 villages near the border zone and was awarded to Ward by the State Council of the South, which works to develop the impoverished region that was occupied by Israel for 22-years.

Israel was forced out in May 2000.

"The stakes are high for our villages that are deprived of drinking water for most of the year. During the occupation, Israel sold us our own waters, which it exploited," said Hussein, an elderly man in Khiam.

He fears Israel will take action.

"If I remember well, Israel bombed in 1964 a project financed by the Arab League to pump water from the Wazzani," he said.

Reacting to Sharon's threats, Energy Minister Mohammed Abdul Hamid Beydoun said Israel's threats had "no justification, and no legal basis".

"Lebanon's share of the Hasbani waters which runs 20 kilometers (12 miles) through Lebanon is undeniable and a new drinking water project for the villages was launched after the liberation of the south," he said.

He said Lebanon was currently using seven million cubic meters (247 million cubic feet) of water per year from the Hasbani and that the project would raise its share to nine million cubic meters.

In sharp contrast, Israel was using between 150 and 160 million cubic meters, he added.

Lebanese Prime Minister Rafiq Hariri has also called U.S. ambassador Vincent Battle "to convey the protest of the Lebanese government" towards Sharon's remarks.