Listen to the full interview via the podcast.

Wales might be reigning Six Nations champions but these are testing times for the nation.

With the Welsh provinces experiencing an exodus of players and the Rabo Direct Pro 12 not capturing the imagination among Welsh fans, the situation has only become more complicated with the standoff between the provinces and the Welsh Rugby Union.

Ospreys, Scarlets, Cardiff Blues and Newport Gwent Dragons have refused to sign a participation agreement with the union and want to leave the ERC-backed Heineken Cup and take part in the proposed Rugby Champions Cup.

But the Union remains tied to the ERC and a deadline of January 31st has been set to come to an agreement, with the WRU to present the clubs with a new agreement on Monday. The Welsh provinces could breakaway and play English clubs if an agreement is not reached.

To discuss the impasse and potential consequences, we spoke to Welsh rugby journalist Simon Thomas.

He sees the WRU's decision to present a new agreement to the clubs as a "bit of an olive branch."

"I wouldn't say it is peace in our time but this has the feeling of a bit of an olive branch. On New Year's Eve the statement from the Union was pretty clear. The speculation was that they were going to set up new regions. It was all-out civil war. But this seems to be the first possibility of returning to negotiations and coming up with a new agreement which could bring a resolution. But of course, the devil will be in the detail."

Thomas explained that the Welsh clubs would receive €1 million more per year if they take part in the Rugby Champions Cup along with the English clubs. And ideally, they would want the Irish and Scottish clubs to also make the move away from the Heineken Cup.

"Their argument is that it is a better competition to compete in and they want Union backing to compete in it. But at this moment in time, the Welsh Rugby Union still remain connected to the ERC-run Heineken Cup. That remains a significant impasse."

While Thomas is unsure whether an agreement can be reached, he believes the Irish and Scottish Unions have a huge part to play if they decide to join the Rugby Champions Cup.

Image: Lloyd Williams of Cardiff Blues clears the ball against Newport Gwent Dragons ©INPHO/Huw Evans