Mr Tony Blair's chief-of-staff plans to embark today on a round of proximity talks at a secret location aimed at resolving the Drumcree standoff or, failing that, defusing the current high tensions over the Orange parade planned for Saturday in Portadown.
Downing Street confirmed that Mr Jonathan Powell would try to break the deadlock over Drumcree. Last July he convened proximity talks in Armagh, but they failed to find a resolution.
A series of Orange and loyalist demonstrations planned for Portadown over Christmas have heightened anxieties. Up to 10,000 Orangemen and supporters are expected for Saturday's parade.
Serious disruption is expected on what is normally Portadown's busiest shopping day of the year. The Orangemen will parade from the town centre to Drumcree, but they have been banned by the Parades Commission from returning down Garvaghy Road.
The Orange Order has already said it will attend the proximity talks. Me Breadan MacCionnaith of the nationalist Garvaghy Road Residents' Coalition , which met last night to consider whether to attend the talks, expressed some scepticism about whether such negotiations could make significant progress in the short term.
A Downing Street spokesman expected that both talks would attend today's talks.
Mr Mac Cionnaith, in a dossier published yesterday by the Garvaghy Coalition, accused the Orange Order of waging "a campaign of terror" against nationalists on the Garvaghy Road.
"Catholic homes and businesses have been attacked, burned and bombed. Catholic citizens have been assaulted, threatened and abused. Four people have also been murdered in incidents directly connected to the ongoing protests related to Drumcree," he said.
The Sinn Fein president, Mr Gerry Adams, said that the North's First Minister, Mr David Trimble, as the local MP in Portadown, should intervene to try to solve or ease the situation.
Reports that some paramilitary elements would be used to marshal Saturday's parade were dismissed by Mr David Jones, press officer for the Portadown Orange District.
"This is extremely untrue. The Portadown Orange District has appointed its own marshals and they will be clearly identifiable," he said.
