Washington's Middle East envoy failed Wednesday for the second day running to iron out a deal on an Israeli settlement freeze that would allow a renewal of peace talks with the Palestinians, according to dpa. Senator George Mitchell met for about two hours in Jerusalem with Israeli Prime Minister Benjamin Netanyahu, but like the meeting between the two on Tuesday, this ended without results. Mitchell made "some progress" towards restarting peace talks between the two sides, according to State Department spokesman Ian Kelly. The US envoy was expected to leave the region later in the day, but will now meet Netanyahu again Friday after returning from visits to neighbouring Arab states. Mitchell met Palestinian President Mahmoud Abbas on Tuesday after a morning meeting with Netanyahu. He will meet again separately with Abbas on Friday. "Senator Mitchell continued to encourage the parties to take responsibility for peace through concrete steps. And both parties reconfirmed their commitment to comprehensive peace and discussed how best to relaunch negotiations," Kelly told reporters in Washington. "And we do believe we're making progress toward that goal." The Palestinians are demanding a total freeze of all Israeli construction in the occupied West Bank, while Netanyahu has said he is willing to accept only a temporary and limited moratorium. The Israeli premier has said that, while he continues the policies of previous governments to build no new settlements, he will also allow the construction of nearly 3,000 new apartments within existing ones. Building in Jewish neighbourhoods of East Jerusalem will also continue, he has vowed. Chief Palestinian negotiator Saeb Erekat reiterated late Tuesday that Palestinian President Mahmoud Abbas would not meet Netanyahu without an Israeli freeze on all settlement activities including building to accommodate population expansion, or so-called "natural growth." "There are no compromises on settlements," Erekat told reporters after Mitchell met Abbas in the West Bank city of Ramallah for two- and-a-half hours. "We are ready to meet our obligations and resume talks from where they stopped. But Israel has to meet its obligations and until now it has not met any of its obligations in the road map." The negotiations are ongoing with only a week left until a hoped- for meeting of Netanyahu and Abbas on the sidelines of the UN General Assembly session in New York. Kelly said there was still no agreement on whether the meeting would take place.