JERUSALEM - Israeli Prime Minister Ariel Sharon said Thursday he is "very satisfied" with Mahmoud Abbas´ efforts to restore calm and that he is eager to resume negotiations with the Palestinian leader.

But in a small snag, the deployment of Palestinian police in southern Gaza, initially set for Thursday, was postponed because of a disagreement with Israel over where the officers should take up positions. It was not immediately clear when the police would begin deploying in the volatile area.

Despite the delay, optimism was running relatively high after Israeli and Palestinian officials held their first round of diplomatic talks Wednesday, and the sides looked toward the possibility of a Sharon- Abbas summit in the next two weeks.

"There is no doubt Abu Mazen has started to work," Sharon was quoted as saying in the Israeli newspaper Yediot Ahronot. Abbas is widely known as Abu Mazen. "I am very satisfied with what I am hearing is happening on the Palestinian side and I am very interested in advancing processes with him."

Meanwhile, in a race that pits Abbas´ ruling Fatah party against his popular rival, the Islamic Hamas group, Palestinian voters in 10 Gaza towns began choosing mayors and councils in the first such election since 1976.

The Gaza vote follows a Dec. 23 election in 26 West Bank towns and villages, and a Jan. 9 presidential race in which Abbas was chosen to succeed Yasser Arafat, who died Nov. 11.

Hamas made a strong showing in the West Bank race - taking over many councils from Fatah - and was also expected to do well in Gaza, where the militant group is popular. Hamas has recently shifted its focus toward politics, and agreed to halt its attacks, at least temporarily.

The developments signaled the possibility of a new era of relations between Israel and the Palestinians and among Palestinians themselves.

In the Yediot interview, Sharon said he would not stop all Israeli military operations for the time being, but would make gestures toward the new Palestinian leader. He did not elaborate.

"I intend to advance the chance for an opportunity for an agreement with the Palestinians, I intend to make gestures toward Abu Mazen and at the same time keep my eyes open and examine the situation on their side," Sharon said.

Israeli and Palestinian security officials met in Gaza twice on Wednesday to arrange the deployment in southern Gaza, which one Israeli government official called "complicated." The official estimated it would take at least a week for Palestinian forces to deploy in the coastal area that has been one of the most volatile since fighting erupted in Sept. 2000.

Palestinian police officers deployed in the northern Gaza Strip last Friday, leading to a halt in rocket fire on Israeli border towns, an issue that led Israeli officials to consider conducting a broad military operation in the area.

In the first high-level diplomatic meeting in months, Israeli and Palestinian officials met Wednesday to discuss the terms for a Sharon- Abbas summit, a meeting that would signal another breakthrough in relations.

"These talks are promising in all aspects," Abbas said after the meeting.

Sharon aide Dov Weisglass and Palestinian Cabinet minister Saeb Erekat met in Jerusalem for two hours and agreed to hold another meeting next week.

Palestinian official Hassan Abu Libdeh, who attended the meeting, said a summit could be held within two weeks. Sharon spokesman Raanan Gissin confirmed a summit is planned but said "our main concern is security - that the Palestinians continue to take additional steps to end the violence, terrorism and incitement."

Palestinians want the summit agenda to focus on other issues, such as the release of Palestinian prisoners and stopping construction of the separation barrier Israel is building in the West Bank.

In a sign of renewed U.S. involvement in the region, senior U.S. envoy William Burns arrived in Ramallah Thursday to meet Abbas and Palestinian Prime Minister Ahmed Qureia. Israeli media reported Burns would also meet Sharon later on Thursday. Burns met Wednesday with Israeli Vice Premier Shimon Peres.

Although optimism is running high, the current lull in violence is fragile.

On Wednesday, Abbas expressed concern about an Israeli arrest raid in the West Bank town of Qalqiliya, where the army shot three men it said were wanted militants. Maher Abu Sneineh, 24, was killed and two were seriously wounded.

"They know that we are fully committed to calming things down and they have to be responsible," Abbas said. "They have to stop these operations so as not to ruin our efforts."

In Gaza, masked Palestinians who said they represented the Al Aqsa Martyrs´ Brigades threatened to renew attacks if Israel does not stop such operations within 24 hours. (Copyright 2005 Associated Press. 01/27/05)