Hamas held talks with Egypt on Thursday on trying to revive mediation with Israel over the release of kidnapped IDF soldier Gilad Shalit held by the Palestinian group, senior officials said. But prospects for any mediation appear dark after the crisis further escalated with Lebanese Hizbullah's capture of two other soldiers from northern Israel on Wednesday. Israel has launched a massive assault on Lebanon, demanding the soldiers' release, even as it continues its military campaign in Gaza, hunting for Shalit, snatched by Hamas-linked fighters in a cross-border raid from Gaza on June 25. Israel has ruled out any prisoner swap for its soldiers. Mohammed Nazzal and Mohammed Nasr, members of Hamas' Damascus-based politburo, held talks on the issue with the chief of Egyptian intelligence, Omar Suleiman, Nazzal said Thursday. He did not comment on the effect of the Hizbullah situation on Hamas' attempts to win a prisoner swap. Before the Hizbullah crisis erupted, Egypt had proposed a plan by which Hamas would free Shalit and later Israel would free an unspecified number of detained Palestinians. Egypt would vouch for Israel's releasing the Palestinians, but the releases would not be simultaneous to mitigate the appearance of an exchange. The scheme fell through last week, with Egyptian officials blaming Hamas. Egyptian President Hosni Mubarak suggested Syria was also to blame, saying "other parties" pushed Hamas to scuttle the deal. Nazzal said Thursday that "Israeli arrogance" was to blame for the failed negotiations. "The Israelis did not accept that they could not get the soldier released without paying a price," Nazzal told The Associated Press. "The Israelis were not clear about the release of the Palestinian prisoners: How many would they release? What are the names? They said nothing at all." "The exchange of prisoners and the solider must be simultaneous. This is at the core of our talks and we cannot abandon it," he said. Nazzal denied that Syrian pressure was to blame for the deal's failure. "Such accusations are a typical Israeli point of view," he said. "They put the responsibility on Syria in an attempt to export the crisis to the outside."