Captured IDF soldier, Cpl. Gilad Shalit, is still alive, according to visiting Egyptian foreign minister, Ahmed Aboul Gheit. Aboul Gheit on Wednesday said Egypt is working to win the release of Shalit, who was captured in a cross-border raid by Hamas in Gaza in June. Egypt is acting as a mediator between Israel and Hamas. "We are working to release him and we know that he's alive," Aboul Gheit told a news conference. "This is a very sensitive issue and we have to treat it with very serious sensitivity," he said. "I hope and believe that he will be released ... but I emphasize that we are working hard for his release and we are sure that he is still alive." Meanwhile, on Tuesday there were reports of a pending deal between Israel and the Palestinians which could see Shalit released "within days," according to a senior Palestinian Authority official. Israel agreed in principle to release hundreds of Palestinian prisoners, he said. Israeli officials denied the report. The PA official, who insisted on anonymity, told The Jerusalem Post that Shalit's captors have agreed to hand him over to the Egyptian authorities as part of a deal that would lead to the release of some 1,400 Palestinians from Israeli jails. He said PA Chairman Mahmoud Abbas's current visit to Cairo was aimed at discussing the details of the ostensible prisoner exchange. Abbas arrived in Cairo earlier Wednesday for talks with Egyptian President Hosni Mubarak on the latest developments surrounding the case of Shalit and the ongoing crisis between Hamas and Fatah. "All I can say at this stage is that there is room for optimism," the official added. "Egypt and Jordan have played a positive role over the past few days in bridging the gap between the Palestinians and Israelis on this issue." According to the official, Israel will release all minors and female prisoners in the first phase of the purported deal. In return, Shalit will be handed over to the Egyptian authorities. In the second phase, Israel will release 300 inmates, after which Shalit will be handed over to Israel. The Palestinians, he said, have received assurances from Egypt that Israel would implement the third and final phase, which envisages the release of another 1,000 prisoners. Gheit had said that he hoped Israel will accept the deal and start releasing prisoners before the Muslim feast of Eid al-Adha, which begins Saturday, the official said. Hamas leaders in the Gaza Strip refused to comment on the report about an impending deal. However, one Hamas legislator told the Post that the Hamas-led government was keen on ending the case of Shalit "as soon as possible." He pointed out, however, that the Gaza Strip was awash with rumors about a prisoner exchange that could take place in the next few days. "There is a feeling on the street that something good is cooking," the legislator added. "The rumors began spreading after last Saturday's meeting between Abbas and Israeli Prime Minister Ehud Olmert." Both Egypt and Jordan have stepped up their efforts in the past few days to try to iron out differences between Abbas and PA Prime Minister Ismail Haniyeh of Hamas. The two countries are said to be playing a "significant" role in bringing about a prisoner exchange between Israel and the Palestinians. Barring last minute obstacles, Haniyeh will travel to Jordan on Wednesday for talks with government officials on the case of Shalit and failed efforts to form a Palestinian unity government. Haniyeh will be the first Hamas official to visit Jordan since the kingdom cut off all relations with the Islamic movement seven years ago. In recent months, the Jordanian government refused to allow Hamas leaders to enter the country. Sources in Haniyeh's office said Jordan's King Abdullah was trying to arrange a summit between Haniyeh and Abbas in a bid to persuade the two to resume talks over the formation of a unity government that would end international sanctions imposed on the Palestinians since Hamas came to power nine months ago. PA officials said Abbas was interested in resuming talks with Hamas over the formation of a unity government despite his threat earlier this month to call early elections. They said Fatah and Hamas representatives were holding secret talks in the Gaza Strip to pave the way for the resumption of the talks and to consolidate the current cease-fire between the two parties. "President Abbas will wait for another three weeks," the officials said. "If the talks fail, then he will issue a presidential decree setting a date for early presidential and parliamentary elections."