Israeli news daily Ha'aretz reports that the Olmert government will be following Wednesday's meeting of Arab League delegations in Cairo to organize the working group to engage the Quartet for Middle East Peace:

Olmert told the cabinet prior to his meeting with Abbas that he was "willing to hold a dialog with any grouping of Arab states about their ideas," an apparent nod toward the Saudi initiative....

On Saturday, government sources said Israel was waiting for the official appointment of the Arab League committee this week. "If its goal is to further the Saudi initiative, then from our point of view, it is possible to engage in dialogue with it," one source said.

Meanwhile, Yediot Ahronot reports of a conversation from two weeks ago between Egyptian and Israeli Foreign Ministers, Ahmed Aboul Gheit and Tzipi Livni, respectively, about the dynamics of the Arab League initiative, and the prospects for the way forward, backward or sideways:

Before the Passover holiday Livni told Egyptian Foreign Minister Ahmed Aboul Gheit that Israel wants to study the Arab League committees’ mandate to advance regional dialogue prior to announcing its willingness to participate in the meetings.

Aboul Gheit, for his part, said Saturday that the Arab League workgroups might contact the Israelis, but he did not expect any negotiations.

"These groups are not mandated to negotiate and I do not imagine that they will negotiate on behalf of anyone, whether the Palestinians, Syria or Lebanon," he said.

The mission of the working groups would be to "lay out the political idea behind the Arab effort and explain what is meant by land for peace," the minister added.