Militant settlers who barricaded themselves in the Sinai town of Yamit, which is scheduled to be turned over to Egypt on April 25, said tonight they would reopen the town while they negotiate with the Israeli government on property compensation.

The announcement came after Israeli Defense Minister Ariel Sharon reportedly told Israel's Cabinet that he planned to take firm action against the settlers' four-day "siege," in which they welded shut the steel gate to the town's only entrance.

The Yamit action committee had previously threatened to resist forcibly any Israeli Army attempt to break through the barricade if the committee's demand for an average compensation of $265,000 per family were not met.

The settlers, aided by government grants and subsidies, established Yamit on the Mediterranean coast after Israel occupied the Sinai in the Six-Day War in 1967.

The standoff at Yamit peaked Wednesday when settlers barricaded the town gate and threw firebombs at government offices in the town. Israeli security forces said they uncovered a cache of gasoline-filled firebombs in the town, and settlers erected a sandbag stronghold atop a building near the gate.

Tonight, Avi Yigal, chairman of the Yamit businessmen's committee, said he had met with Israeli Army Gen. Dan Shomron, who arranged a meeting for Monday with Sharon.

Yigal, in an interview on Israel radio, said, "We'll return to normal life with an open gate, and I hope it will be so, and we'll negotiate with one of the ministers about compensation and everything about the future."

The settlers stressed they were concerned about payment for giving up their homes and were not attempting to prevent Israeli withdrawal from the Sinai.

Yigal said the "common goal on both sides is to prevent bloodshed, so this is the main thing."

However, he said, "if the Army will try to open the gate with force, God forbid, we'll resist."

The Yamit residents have complained of government footdragging on compensation, which they say must be settled before Egypt takes control of the last remaining Israeli-occupied portion of the Sinai on April 25.