West Bank - Palestinian President Mahmoud Abbas said on Saturday he was pressing ahead with January elections but held out hope that reconciliation with his Hamas rivals could still be achieved.

Abbas, 74, issued an order for new elections on Friday after Egyptian-backed efforts failed to reconcile his Fatah faction, which holds sway in the West Bank, and the Islamist group Hamas, in control of the Gaza Strip.

Hamas rejected the call and suggested it might hold its own ballot in the Gaza Strip, a move that could create two rival presidents, two parliaments and two prime ministers in two separate Palestinian territories.

Speaking at a meeting of the Palestinian Central Council in the West Bank city of Ramallah, Abbas said he would go ahead with the January 24 date set by the Palestinian Basic Law.

Parliamentary elections were last held in 2006, when Hamas defeated the once dominant Fatah.

This is the law, we have to do it. We are proceeding with the constitutional deadline. (At the same time) we will proceed with reconciliation efforts, Abbas said.

He added that the presidential and parliamentary elections could be postponed until June, as proposed by Egypt in recent unity talks, if the factions could reach an agreement. But Hamas's angry reaction was a bad omen.

Hamas spokesman in Gaza, Fawzi Barhoum, said Abbas's speech in Ramallah was full of lies, deceptions and contradictions.

He attempted to turn public opinion against Hamas, Barhoum said.

Abbas has no clear successor and would be expected to lead his party into the campaign, seeking re-election. He dismissed accusations that the election decree was a political maneuver designed to strengthen his authority.

The Islamist movement challenges the legitimacy of Abbas's presidency, saying his mandate expired in January this year. It had already threatened to defy a January election call.

Hamas, which drove forces loyal to Abbas out of the Gaza enclave in 2007, said it would not allow an election to take place on its territory in the absence of an accord with Fatah.

(Reporting by Mohammed Assadi and Ali Sawafta; Editing by Andrew Dobbie)

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