Peter Jackson in talks to direct "Hobbit" movies

LOS ANGELES (Hollywood Reporter) - It seems Peter Jackson might direct the two "Hobbit" movies after all.

The "Lord of the Rings" maestro is in negotiations to shoot the long-awaited adaptations, which were left without a captain after Guillermo del Toro parted ways on May 30. Obstacles to a deal remain, including agreeing on a schedule that will allow Jackson to fast-track the films for release in 2012 and 2013, but insiders are cautiously optimistic that a pact can be worked out.

Talks, which have been going on for a week or two, heated up in recent days between Warner Bros./New Line and Jackson's team. Complications include the shaky financial situation of partner MGM, which owns the "Hobbit" rights and could hold up the production timetable. A significant delay would be a dealbreaker for Jackson.

Del Toro left the project over similar timing concerns. His move surprised observers because the filmmaker had devoted so much time to work with Jackson drawing up plans for the movies, and working on the script with Jackson and his fellow "Lord of the Rings" scribes Fran Walsh and Phillippa Boyens. He even moved his family to New Zealand, and casting was in the early stages.

But since his departure, Warners/New Line, which runs point on the production over partner MGM, never did a full-on search for a director, even as some names surfaced as possible contenders. Why? Because Warners/New Line was trying to woo Jackson back to Middle-earth.

Jackson has other commitments -- the director has been working on secret projects -- and wasn't sure he wanted to devote another chunk of his life to the tales of J.R.R. Tolkien. But because of the complicated nature and the advanced stage of the undertaking -- Middle-earth was being built from the ground up when del Toro left so unexpectedly -- it wasn't simply filling a chair with a warm body.

To Warners/New Line, Jackson is the most logical choice not only because he made the "Lord of the Rings" movies but also because he is deeply involved as a producer on the "Hobbit" films.