After months of shuttle diplomacy, the Obama administration is set to plunge into a new round of Mideast peacemaking, bringing Israeli and Palestinian leaders together for face-to-face talks for the first time in nearly two years.With expectations low and U.S. officials allowing that success in Thursday's negotiations may be defined simply as an agreement to meet again, President Barack Obama was preparing to host Israeli Prime Minister Benjamin Netanyahu and Palestinian President Mahmoud Abbas on Wednesday.The goal is to formalize a peace agreement in a year's time that will lead to the creation of a Palestinian state. But with the two sides far apart on all the key issues, the going is expected to be slow and fraught with difficulties.Ahead of Thursday's sessions, Secretary of State Hillary Rodham Clinton and the administration's Mideast peace envoy George Mitchell were meeting on Tuesday with Abbas and Netanyahu as well as the foreign ministers of Egypt and Jordan and former British Prime Minister Tony Blair, the representative of the "Quartet" of Mideast peacemakers.On Wednesday, Abbas and Netanyahu will meet separately with Obama. Then, joined by Jordan's King Abdullah and Egyptian President Hosni Mubarak, they will attend a White House dinner intended to set the stage for the launch of formal talks a day later at the State Department. Jordan and Egypt are the only two Arab nations with peace deals with Israel.One major immediate challenge will be the Palestinians' demand that Israel extend a 10-month freeze on settlement construction in the West Bank that expires on Sept. 26.Netanyahu, who faces pressure from his right-wing Likud Party and hawkish coalition partners to resume building inside West Bank settlements when the freeze ends, has made no such pledge. And, Palestinian officials have warned that without one, the talks in Washington may be nothing more than a two-day excursion to the U.S. capital.Beyond the settlements, Israel and the Palestinians face numerous hurdles on resolving the other issues of contention, notably the borders of a future Palestinian state, the political status of Jerusalem and the fate of Palestinian refugees.At the same time, internal Palestinian divisions that have led to a split between Abbas and his West Bank-based administration and the militant Hamas group in control of Gaza will complicate the talks. Hamas is not part of the negotiations and has said the talks will be futile.American officials are hopeful they can at least get the two sides to agree to a second round, likely to be held in the second week of September in Egypt. That could be followed by another meeting between Obama, Netanyahu and Abbas on the sidelines of the U.N. General Assembly near the end of the month, they said.Netanyahu has said he would like to meet regularly with Abbas, perhaps every two weeks, as lower-level talks expected to convene in working groups continue. During that period, Clinton and Mitchell would be available to offer suggestions to help the parties overcome obstacles they encounter, the officials said.Indeed, Abbas told reporters accompanying him to Washington on Tuesday that he hopes for an active U.S. role with the administration presenting "bridging proposals" to close gaps.But that formula has failed in the past, notably when former President Bill Clinton was unable to get the two sides to agree to a peace deal at Camp David in 2000, and then again when former President George W. Bush tried his hand at resolving the conflict starting with the Annapolis conference in 2007.Netanyahu has refused to pick up where the Annapolis negotiations left off in December 2008 between Abbas and then-Israeli Prime Minister Ehud Olmert, who was more moderate than Netanyahu.The Palestinians want a state in the West Bank, Gaza and east Jerusalem — territories Israel captured in the 1967 Mideast War.