The power-sharing Executive is to re-examine the plan to create seven so-called super councils, approved by former Northern Ireland Secretary Peter Hain.
Peter Hain announced proposed changes in November 2005
Senior Stormont sources suggest ministers may opt for an 11-council model.
In November 2005, Mr Hain ruled that the current 26 local councils should be reduced to seven.
Sinn Fein supported the move, but the other local parties argued the reduction was too severe. Now some Stormont sources believe an 11-council model is the most likely compromise.
On Thursday, the executive will discuss setting up a committee to be chaired by Environment Minister Arlene Foster.
The committee will include ministers from all four executive parties.
They are Finance Minister Peter Robinson, Regional Development Minister Conor Murphy, Health Minister Michael McGimpsey and Social Development Minister Margaret Ritchie.
It's hoped the committee will report back by the end of this year.
Besides looking at the number of councils, the committee is also expected to discuss which functions should be carried out by the new councils.
Previously it had been suggested the new councils should take responsibility for planning, local roads, urban and rural regeneration and some housing services.
However, there's speculation that now Stormont is up and running the powers granted to the new councils could be more limited.
Under the original timetable, elections were due to be held to the new councils next year, with the super councils taking power in the spring of 2009.
However, re-writing the plans could mean a delay of two years in implementing the shake up.
This would mean extending the existing 26 councils' lives until new local government structures come into existence in 2011.
In March last year, Peter Hain predicted that the shake-up in local bureaucracy would lead to savings worth more than £200m a year.
But if more councils are retained this will raise fresh questions over the level of any savings likely to be produced by the shake up.
Sinn Fein remains in favour of seven councils and has so far shown no willingness to support a higher number.
Under the Stormont cross-community voting system it could veto a compromise it doesn't like.
However, the other parties also have a veto over the future, as the assembly must approve the recommendations of a recent local government boundary review before any elections can go ahead.