JERUSALEM – Israel and the Palestinians have agreed to begin indirect, American-brokered talks, U.S. Mideast envoy George Mitchell announced Monday.

The agreement ends a 14-month deadlock in peacemaking and represents the Obama administration’s first substantive diplomatic achievement here.

The announcement, however, came just hours after Israel enraged Palestinians by announcing new West Bank settlement construction on the same day Vice President Joseph Biden landed in the region to promote negotiations.

Israel’s decision to build 112 new housing units on lands Palestinians claim for a future state highlighted the tough road ahead for those seeking peace in the region.

Mitchell, the former Maine senator and U.S. envoy who is visiting the region, said he hoped the indirect talks “will lead to direct negotiations as soon as possible.”

And in what might have been a reaction to the latest Israeli move, he appealed to the two sides not do to anything that could jeopardize the talks.

“We also again encourage the parties, and all concerned, to refrain from any statements or actions which may inflame tensions or prejudice the outcome of these talks,” said Mitchell, who is expected to shuttle between Israel and the Palestinians for the next several weeks.

Israel authorized construction of new apartments in the West Bank despite a pledge to halt all new settlement building, the government disclosed Monday – just as Biden landed in Israel for the highest-level visit yet by an Obama administration official.

The announcement came a day after Palestinians agreed to hold indirect talks with Israel, backing off from a demand that Israel freeze all building in the West Bank and east Jerusalem. They considered Israel’s willingness to halt new construction insufficient because it excluded east Jerusalem and projects already under way.