Occupied Jerusalem: Israel has told Hezbollah via German mediators it would be willing to free jailed Lebanese fighters in exchange for two soldiers abducted in 2006, Israeli security sources said on Sunday.

Topping the proposed release roster, they said, is Samir Qantar, who is serving a life sentence for a deadly 1979 raid and whom Israeli officials previously described as a "bargaining chip" for the return of a missing Israeli airman.

"Israel's position is it's willing to release Qantar and the other jailed Lebanese for Regev and Goldwasser," an Israeli source said, implicitly excluding Palestinians from any swap.

Another security source described this as Israel's "take it or leave it" counter-offer to Hezbollah after a military inquest found that one or both soldiers may not have survived the July 12, 2006 ambush, during which their convoy took heavy fire.