RAMALLAH, April 24 (JMCC) - Hamas leader Khaled Mashaal denied that the movement had agreed secretly to accept the creation of a Palestinian state alongside Israel.

We reject the two-state solution because it means recognition of Israel, Mashaal said, speaking to al-Jazeera television channel.

Meshaal was refuting claims made by Palestinian president Mahmoud Abbas in a Saturday speech to his own political faction, Fateh.

Abbas charged in his televised address that Hamas told Arab negotiators that it was ready to accept the two-state solution, as well as an Israeli withdrawal to the pre-1967 borders and an Arab initiative that offers Israel recognition in exchange for an end to Israel's 1967 occupation.

These three issues are important components of a plan to reconcile the two Palestinian factions, which have been engaged in a power struggle ever since Hamas won a majority in parliamentary elections in 2006.

Hamas has said that it would accept an Israeli withdrawal to the 1967 borders in exchange for a long-term truce with Israel.

Fateh, however, is demanding that it agree to the two-state solution before allowing Hamas to participate in the Palestine Liberation Organization. The PLO is signatory to peace agreements with Israel, and has long been dominated by Fateh.

The reason we are wary is recognition of Israel, said Mashaal. Acceptance of the two-state solution and the Arab initiative imply this recognition, he said.