Club officials met the 27-year-old's representatives on Sunday night but the deal on the table did not come close to meeting the point where he would consider leaving St James' Park.
However, while the Ba camp has indicated the Senegal international does not now expect to be playing his football at Stamford Bridge next month, it is likely the impasse represents only the initial skirmish in a battle which could run and run.
Newcastle manager Alan Pardew says agents claiming to work on behalf of the striker are responsible for the transfer talk.
"I feel bit sorry for Demba because people out there fuelling it are not involved," he said. "The contract is what it is and as manager I want it to be resolved.
"There is a contract for him to sign and it is getting close to the point where we say no more but the offer is still there. I want him to stay.
"It has been a saga since the summer and the way the contract was drawn up at the time means we can't get out of it, but I understand why it was that way at the time.
"I still think in this window he will stay because of the situtation we are in, but that will be up to him.
"The contract terms have been bandied around which has not helped and people are getting involved who have no right to be involved. It is difficult for our fans because they love him and they want him to play in a black and white shirt - we look potent again."
The Blues are among a series of clubs to have been linked with the former West Ham frontman, who scored his 12th and 13th goals of the season at Arsenal on Saturday, with the £7 million release-clause in his contract due to become active once again on Tuesday.
As yet, the Magpies insist they are yet to receive a bid that would trigger that clause.
The deal Ba signed when he joined Newcastle during the summer of 2011 was intensely complicated as a result of the medical condition of his knee and they have spent recent months attempting to renegotiate it.
However, the two sides have been unable to reach agreement and with the player's network of representatives clearly active behind the scenes, the waters are becoming increasingly muddied by the day.
What is clear is that any deal would cost significantly more than £7m when signing on and agent fees, as well as a lucrative wage packet, are taken into consideration.
Pardew is keen to retain the services of a man who scored 16 goals last season and insists he has never received any indication from the player that he wants to leave.
But the lure of Champions League football and a significantly more lucrative weekly salary could yet prove decisive.
- Sports & Recreation