Renewed Israeli construction in the West Bank following the settlement freeze's expiration will be limited and won't prompt the Palestinian Authority to quit direct talks with Israel, a senior PA official says.

The senior official, who is closely familiar with the negotiations, told Ynet Monday that construction will not be renewed in a manner that would "embarrass" the PA.

According to the compromise being worked out, construction will be limited to the large settlement blocs and to building work that started before the freeze, the source said. He stressed that both the Palestinians and Americans will not allow Israel to take advantage of the more lenient Palestinian position in order to build outside the settlement blocs.

"The point of departure is that only the large blocs will remain under Israeli sovereignty, with negotiations conducted on the scope of alternate areas to be given to us in exchange for handing over the blocs to Israel," the senior Palestinian official said.

The official also said that both sides understand the need to avoid the introduction of obstacles to the negotiations ahead of the upcoming US Congress elections in November.

Other Palestinian sources estimated that the compromise in respect to West Bank construction will take the form of a "quiet freeze," with Israel's Defense Ministry holding up construction permits. The sources noted that as part of the understandings worked out in respect to construction, the Palestinians demand that serious negotiations be launched on the issue of borders, which includes the fate of the settlements.