* Palestinians announce last-minute deal with shaky start
* Israel signals it has not yet agreed to ceasefire
* Netanyahu orders military to "respond" to rocket fire (Recasts with Palestinians announcing extended truce)
By Nidal al-Mughrabi and Lin Noueihed
GAZA/CAIRO, Aug 13 (Reuters) - Israel and the Palestinians agreed on Wednesday to extend a Gaza truce by five days minutes before an earlier ceasefire was set to expire, a Palestinian official said in Cairo.
But the deal got off to a shaky start. Israel, which had no comment, bombed several Gaza sites early on Thursday, minutes after the truce extension was to have taken hold, in response to Palestinian rocket fire that violated the earlier truce.
Prime Minister Benjamin Netanyahu ordered Israeli forces to "respond" to two instances of rocket fire by Gaza militants at Israel in violation of the truce on Wednesday. The rockets caused no damage or casualties, and one was shot down by Israel's Iron Dome missile interceptor.
There were no reported casualties in the Israeli air raids that targeted at least three sites in northern Gaza, witnesses and Hamas said. Hamas denied involvement in one of the rocket shootings which sent sirens wailing across southern Israel.
The Israeli military said it was "targeting terror sites across the Gaza Strip." Shortly afterwards, more sirens warning of rocket fire from Gaza were sounded early on Thursday.
As truce negotiations dragged on during Wednesday, Israel moved forces closer to Gaza and called up additional reservist troops, Israeli media reported. The military said its forces were "moved around on a routine basis" and would not elaborate.
In announcing the truce extension, Azzam Al-Ahmed, the head Palestinian negotiator in Egypt, a member of Palestinian President Mahmoud Abbas's mainstream Fatah faction said on Wednesday evening in Cairo that "it was agreed to extend ceasefire by five days."
Abu Mujahed, spokesman for leading Gaza militant group the Popular Resistance Committees, told Reuters Palestinian factions had "accepted" that proposal.
The extension came in lieu of a broader deal which the parties meeting in indirect talks brokered by Egypt failed to reach in time for the earlier truce deadline.
A Palestinian official, speaking on condition of anonymity, said Egypt had presented a new proposal for a permanent truce agreement that addressed a major Palestinian demand for a lifting of the Israeli and Egyptian blockades of the Gaza Strip.
Israel and Egypt harbour deep security concerns about Hamas, the dominant Islamist group in the small, Mediterranean coastal enclave, complicating any deal on easing border restrictions.
ISRAEL WANTS GAZA DEMILITARISED
It was unclear how those worries, along with Israel's demand for Gaza's demilitarisation, would be dealt with. Hamas spokesman Sami Abu Zuhri said disarming was not an option.
Hamas leader Ismail Haniyeh told Al-Aqsa Hamas television the group would insist on "lifting the Gaza blockade" and reducing movement restrictions on the territory's 1.8 million residents, as a prerequisite to achieving a "permanent calm".
Egyptian and Palestinian sources said Israel had tentatively agreed to allow some supplies into the Gaza Strip and relax curbs on the cross-border movement of people and goods, subject to certain conditions. They did not elaborate, and in Israel, officials remained silent on the state of the talks.
A Palestinian demand for a Gaza seaport and reconstruction of an airport destroyed in previous conflicts with Israel has also been a stumbling block, with the Jewish state citing security reasons for opposing their operation.
The sides have agreed though to delay discussion of any agreement on the ports for a month, a Palestinian official said.
As part of the Egyptian blueprint, Israel was expected to expand fishing limits it imposes on Gaza fishermen to 6 miles (10 km) from the usual 3-mile offshore zone.
"It will increase gradually to no less than 12 miles in coordination between the Palestinian Authority and Israel," the official said, referring to a likely expanded role in Gaza affairs for the government of Western-backed Abbas, based in areas of the West Bank not occupied by Israel.
In addition, the official said, the Egyptian plan calls for reducing the size of a "no-go" area for Palestinians on the Gaza side of the border from 300 metres (328 yards) to 100 metres so that local farmers can recover plots lost to security crackdowns.
The two sides are not meeting face-to-face in Cairo: Israel regards Hamas, which advocates its destruction, as a terrorist group. But the official said once they inform Egypt of their agreement, a ceasefire accord could be signed the same day.
The Gaza hostilities have killed 1,945 Palestinians in the Gaza Strip and 67 on the Israeli side. Most of the Palestinian dead have been civilians, hospital officials in the small, densely populated enclave say.
Israel launched its military campaign on July 8 to quell cross-border rocket fire from Gaza
The heavy losses among civilians and the destruction of thousands of homes in Gaza, where the United Nations said 425,000 of 1.8 million population have been displaced by the war, have stoked international alarm.
Israel pulled ground forces out of Gaza last week after it said the army had completed its main mission of destroying more than 30 tunnels dug by militants for cross-border ambushes. It now wants guarantees Hamas will not use any reconstruction supplies sent into the enclave to rebuild the tunnels.
An Italian journalist, his translator, three Palestinian bomb disposal workers and one other person died on Wednesday when unexploded munitions blew up in the north of the enclave as attempts were being made to defuse the ordnance, officials said.
Simone Camilli, 35, a video journalist working for the Associated Press, was the first international journalist killed in the latest Gaza conflict. Palestinians say more than 10 local media workers have also died in the fighting.
(Additional reporting by Allyn Fisher-Ilan and Dan Williams in Jerusalem, Stephen Kalin and Asma Alsharif in Cairo; Writing by Jeffrey Heller in Jerusalem; Editing by Mark Heinrich, Crispian Balmer and Lisa Shumaker)
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