Talks on Saturday between an Iraqi mediator and a representative of a Kuwaiti firm to try to free seven of the company's employees have been positive but have yet to reach a final deal, the mediator said.
Sheikh Hisham al-Dulaymi told Reuters the talks with Kuwait and Gulf Link Transport Company would resume on Sunday to try to win the release of three Indians, three Kenyans and an Egyptian kidnapped in Iraq earlier this month.
"So far the outcome is positive. We have agreed on many issues, but we still need time. The company said it was ready to help the Iraqi people," Dulaymi said, adding that he expected a deal could be reached early on Sunday.
"We are working for a humanitarian cause and hopefully we will get them back home safely," he said, saying that he was asking for patience from the kidnappers - a group calling itself the "Black Banners" brigade of the Islamic Secret Army.
A source at the talks who declined to be identified said earlier the Kuwaiti firm had agreed to one of the demands of the kidnappers - ceasing to work in Iraq. But the firm told Dulaymi that another demand - the release of Iraqi prisoners in Kuwait - was impossible for a private company to achieve.
The talks were also focusing on compensation which the kidnappers want the firm to pay for Iraqi victims of fighting and US air strikes in the restive city of Falluja.
On Thursday, the kidnappers issued a videotape showing one of the Indian hostages dressed in orange clothing and with a gun pointed at his head. The tape threatened to execute one of the hostages the following day unless negotiations got under way.
Kidnappers in Iraq have repeatedly dressed hostages in orange before killing them, usually by beheading. The clothing mimics the orange jumpsuits worn by prisoners in US detention facilities, including those at Guantanamo Bay in Cuba.
Indian junior foreign minister Edappakath Ahamed said an envoy to Oman was being sent to Baghdad to help negotiations.
Dulaymi is the head of a major Iraqi tribal group and said he had acted as mediator in freeing other hostages in Iraq, including three Japanese who were released in April and two Russians were freed the following month.
Dozens of foreign hostages have been seized in recent months, most of them truck drivers working for foreign companies delivering supplies to US forces or Iraqi companies. At least eight hostages have been killed - four of them beheaded.
An Iraqi government source said the Iraqi authorities were speaking to foreign transport companies to urge them to employ Iraqi drivers in an effort to stem the wave of kidnappings.
An Iraqi group holding four Jordanian truck drivers hostage has pledged to release the men after establishing they were not carrying goods to US troops, relatives said on Saturday.
Mohammad Hassan Abu Jafaar, 45, the brother of Ahmad Hassan Abu Jafaar, one of the four drivers seized on Tuesday, said the kidnappers allowed his brother to speak to him on Saturday.
"Ahmad told me and his wife Nabila he was in good health and treated well by the Iraqi resistance," Abu Jafaar said.
The fate of two other Jordanian drivers abducted last Monday by another group remained uncertain, relatives said.
A Somali driver is also being held in Iraq, by a group linked to al Qaeda ally Abu Musab al-Zarqawi. Earlier this week, kidnappers executed two Pakistani hostages.
A Turkish truck driver, Mehmet Dayar, held hostage in Iraq for 12 days has arrived home in south-east Turkey, having been released after pledging never to return to Iraq, CNN Turk television reported on Saturday.
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