The Taoiseach, Mr Ahern, and the British Prime Minister, Mr Tony Blair, resume talks with the pro-Belfast Agreement parties at Hillsborough today still confident that a deal can be brokered that will allow for the restoration of the Northern Executive and Assembly.
The main focus of today's negotiations will be trying to break the deadlock between the Ulster Unionist Party and Sinn Féin over the issue of sanctions for any IRA breaches of its commitments to non-violence and over the nature of IRA decommissioning, whether it should be visible or in secret.
Despite the outstanding matters to be resolved Mr Ahern was optimistic of a breakthrough. "We have been having very useful and intensive exchanges. I am happy that we have made progress. It is important that we continue with the talks," he said before returning to Dublin last night.
"We are therefore resuming with a view to ensuring the greatest level of progress and mutual understanding by all of the parties on the various issues which still need to be addressed."
The UUP leader, Mr David Trimble, warned last night that the issue of sanctions could be a "deal-breaker".
Counselling caution about the possibility of a deal, he said: "We are continuing to emphasise very clearly to republicans that it is absolutely essential that the republican movement defines its position as being an end to paramilitarism. They really do have to go away. We have to know that the so-called war is over."
Equally, Sinn Féin insisted that it would not tolerate being held to account in the future for any perceived IRA misdemeanours. "We are not agreeing with anything that moves outside the terms of the Good Friday agreement," said senior Sinn Féin negotiator, Mr Pat Doherty.
Mr Trimble is also adamant that the only way to convince unionists of republican bona fides is by the IRA visibly and verifiably demonstrating that it has carried out a major act or acts of disarmament.
This issue should be left solely to Gen John de Chastelain's decommissioning body, retorted the Sinn Féin chairman, Mr Mitchel McLaughlin.
Senior British and Irish officials were working into the early hours of this morning to try and chart a compromise around these obstacles to a deal. Said a British government spokesman: "These are serious talks, there is serious progress, and there is serious hope of the Prime Minister, Taoiseach and the parties being able to work through these issues."
Neither the British nor the Irish government is expecting a final agreement today, but both are convinced that what emerges from these talks can in the short term be sold to the republican and Ulster Unionist constituencies, the two groupings which have most concerns about the ultimate complexion of the deal.
"I don't really expect that a big fat document will be produced at the end of this sequence of talks," said Mr Blair's official spokesman last night.
These talks are being conducted on the basis of a 28-page draft package including five annexes. While the IRA has yet to pronounce how it might meet the two governments' requirement to cease paramilitary activity, there was growing confidence in Hillsborough last night that if the sanctions and decommissioning issues could be overcome the IRA would respond positively.
There was also consensus that progress is being made on issues such as demilitarisation, devolving responsibility for criminal justice and policing to a Northern Executive, persuading Sinn Féin on to the Policing Board, and producing legislation that would ensure IRA fugitives, the "on the runs", did not serve any time in prison.
While the Taoiseach and the Minister for Foreign Affairs, Mr Cowen, returned to Dublin last night, Irish and British officials and the political parties continued to work late into the night attempting to flesh out details of a final package.
Mr Ahern is returning to Hillsborough for 8.30 a.m. today and will miss this morning's weekly meeting of the Cabinet.
However, a Government spokeswoman said Mr Ahern intended to be in the Dáil for Taoiseach's questions this afternoon if the Hillsborough negotiations end by lunchtime.
Mr Blair is due to hold talks with the Russian Foreign Minister, Mr Igor Ivanov, this afternoon.
Asked if a deal was possible Mr Doherty said: "We certainly want this to be brought to a conclusion." If as much progress was made today as was made yesterday a deal was possible, he added.
However, the timetable ahead could be complicated by the Sinn Féin leadership's apparent need to get the approval of a special delegate conference before the party joins the NI Policing Board.
