JERUSALEM -- A Libyan charity's ship, flanked by Israeli missile boats, was sailing in the direction of an Egyptian port on Wednesday, apparently deciding not to defy Israel's naval blockade of the Hamas-ruled Gaza Strip.

Egypt's state news agency MENA cited an unidentified security official as saying that Egyptian authorities and the Red Crescent medical service were "making preparations" to receive the Moldovan-flagged Almathea.

An Israeli military official, speaking on condition of anonymity because he was not authorized to discuss the ship's course, confirmed that the vessel was headed in the direction of the Egyptian port of El-Arish.

With the vessel's organizers insisting the ship would go to Hamas-ruled Gaza and Israel insisting it would not, the potential for a showdown on the high seas had loomed large. Framing the faceoff was a deadly Israeli naval raid of another blockade-busting ship in May.

An Al-Jazeera reporter on board the Almathea reported that two Israeli missile boats were hewing close to its left side to prevent it from veering to nearby Gaza. The Egyptian port of El-Arish was on the ship's right.

Conflicting messages on Tuesday created confusion over whether the Amalthea intended to try to run the blockade or not.

Israeli military officials said the ship's captain informed Israel he was heading for the Egyptian port. Egypt had promised to transfer the ship's supplies to Gaza if the vessel docked there.

However, a spokesman for the Libyan mission insisted the ship still intended to try to reach the Palestinian territory -- but wouldn't violently resist any efforts to stop them.

"First and foremost, we want to arrive to Gaza. If this is impossible, we don't want to subject anyone to danger," Youssef Sawani, an official with the Qaddafi International Charity and Development Foundation who was in contact with the boat, told the pan-Arab Al-Jazeera television station.

The ship reported late Tuesday that engine trouble had stalled it, but it resumed its journey midmorning Wednesday.

The Ghadafi foundation, headed by the son of Libyan leader Muammar Qaddafi, said the Amalthea left Greece on Saturday carrying 2,000 tons of food and medical supplies.

Israeli government spokesman Mark Regev had repeated a standing offer, inviting the activists to sail to the Israeli port of Ashdod and unload the supplies there.

The deaths of nine pro-Palestinian activists in the May 31 raid focused international attention on Israel's blockade of Gaza, imposed after the Islamic militant and anti-Israel Hamas overran the Palestinian territory in June 2007. The international criticism forced Israel to ease its land blockade of the territory but it has maintained the naval embargo, insisting it is vital to keep weapons out of Hamas' hands.

A Gaza health official said a 42-year-old Palestinian woman was killed and four other Gazans were wounded late Tuesday by an Israeli tank shell. The military said it opened fire after spotting people near the security fence they suspected might be laying explosive devices.

The Gaza blockade and the challenges to it have caused Israel serious diplomatic damage, putting it on the defensive against demands for inquiries and criticism for its role in Gaza's plight.

Israel says the commandos who took part in the May 31 raid were defending themselves against violent pro-Palestinian activists. Activists have said they acted in self-defense after Israeli troops landed on their ship.

Israel has resisted calls for a U.N.-led inquiry but has appointed two panels, one military and one civilian, to review the raid.

Findings released Monday from the military-commissioned report found flawed planning and intelligence-gathering but concluded the commandos were justified in opening fire after being confronted by violent pro-Palestinian activists on board the lead ship.

The mandate of the civilian inquiry is limited to investigating the legality of the operation. Two international observers have been attached to the civilian commission, which is led by a retired Israeli Supreme Court judge.