Police and security officials in the Sinai planned a military operation during an emergency meeting Saturday, an unnamed military official told the Ma'an News Agency.
The army intends to carry out the operation only after intelligence has verified the identities of the kidnappers and the locations where the seven Egyptians are being held, the agency said. Other Egyptian officials told the Palestinian news agency the captives were in different locations, of which some have already been identified.
The move came after mediation efforts to secure the servicemen's release failed.
The seven were abducted at gunpoint Thursday as they traveled in northern Sinai. Egypt has since shut down the Rafah border crossing between Egypt and the Gaza Strip, and hundreds of Egyptian police officers have protested at the crossing demanding Morsi act to release the seven.
The Egyptian daily al-Masri al-Youm said the kidnappers demanded the release of jihadists arrested by Egyptian authorities for their alleged involvement in attacks on police stations in the Sinai Peninsula in 2011.
Security in the Sinai has deteriorated since the ouster of Hosni Mubarak as president in 2011.