Hernandez agreed to a 5-year, $78 million contract in January 2010 and has earned an additional $2.5 million in escalators and $300,000 in bonuses. He is due $20 million this year and $20.5 million in 2014, which would be superseded by the new deal.
Seattle general manager Jack Zduriencik said he could not comment when reached on Thursday, and Hernandez's representatives didn't immediately return messages.
If the deal is finalized, it would leave Detroit's Justin Verlander and the Dodgers' Clayton Kershaw as the most attractive pitchers eligible for free agency after the 2014 season. Tampa Bay's David Price is eligible after the 2015 season.
Hernandez has become the face of Seattle's struggling franchise, transforming from a curly-haired 19-year-old who wore his hat crooked to one of the most dominant and exciting pitchers in baseball. Known as "King Felix," he became the first Seattle pitcher to throw a perfect game in a 1-0 win over Tampa Bay last August.
Hernandez, who will turn 27 on April 8, is 98-76 with a 3.22 ERA in eight seasons with the Mariners. He won a career-high 19 games in 2009 when he finished second in the Cy Young voting, then won the award a year later when he went just 13-12 but had a 2.27 ERA and 232 strikeouts. Hernandez appeared to be making another Cy Young push last year before going 0-4 in his last six starts, which left him at 13-9 with 223 strikeouts.
Also, the Mariners signed backup catcher Kelly Shoppach to a 1-year, $1.5 million.
A police report says Rockies first baseman Todd Helton told an officer that he had two cups of red wine hours before he was arrested early Wednesday. A witness reported seeing Helton's truck swerve into a median before he pulled into the gas station where he was arrested in a Denver suburb. Helton is due in court May 20 on charges of DUI and careless driving.
* San Francisco reliever Sergio Romo agreed to a 2-year, $9 million contract that will be worth up to $10.2 million if he closes regularly.
* Cleveland infielder Mike Aviles agreed to a 2-year, $6 million contract that includes a club option for 2015.