TEL AVIV, September 15, 2009 (WAFA)- Israel and the United States failed to reach a compromise on the contentious issue of West Bank settlement construction, daily Haaretz said.

 Isareli Prime Minister Benjamin Netanyahu met for two hours in Jerusalem with U.S. President Barack Obama's special envoy to the Middle East, George Mitchell. The meeting ended with no results.

The prime minister's bureau released a statement to the press describing the sit-down as 'good.' The two men will resume their discussions in Netanyahu's office Thursday morning.

The inability to strike a final deal thus forces Mitchell to extend his stay in Israel. The envoy has been engaged in intensive efforts to wrest an Israeli commitment to halt settlement construction in time for next week's United Nations General Assembly meeting.

Haaretz said  At the start of the meeting, envoy George Mitchell told the premier that he is hopeful the U.S. and Israel can reach agreement on the future of settlement construction in the West Bank.

Mitchell said 'We hope to bring this phase of our discussions to early conclusion and to move forward in our common search for a comprehensive peace in the region.'

Understandings between the U.S. and Israel on the issue would pave the way for peace negotiations between Israel and the Palestinians, Mitchell told Netanyahu.

In addition, Mitchell said he is hopeful that Netanyahu, Obama, and President Mahmoud Abbas will jointly meet on the sidelines of the United Nations General Assembly in New York later this month.

The Palestinians are demanding a complete freeze on settlement construction as a precondition to peace talks with Israel.

Netanyahu is willing to approve only a partial construction freeze for a period less than the year the Americans are demanding. It is believed that the two sides will compromise on a nine-month hiatus in construction.