Australia's offshore detention system would be shut down before the next federal election under a series of worldwide deals.
While the number of asylum seekers attempting to reach Australia by boat pales in comparison to those seeking refuge in Europe, the nation's harsh immigration policies adopted in 2013 dictate they will never reach the mainland.
Such an agreement struck with the Obama administration could be opposed by President-elect Donald Trump, who has called for a moratorium or tight restrictions on Muslim immigration.
Sky News understands the government will make an announcement on a joint asylum seeker deal with the United States tomorrow. Most of the asylum seekers are Muslims from the Middle East, Africa and Asia.
Australia has refused to give the detainees asylum due to its tough border blockade policy, which rules that no asylum seeker who has arrived since the law was passed can settle in the country.
There is a growing expectation that some asylum seekers will be offered a home in the USA, probably in return for Australia's pledge to take Central American refugees in transit in Costa Rica.
During a September visit to the US, Australia's Prime Minister Malcolm Turnbull said that talks were underway with the Obama administration for the resettlement, in Australia, of displaced peoples from Central America now based in US-supported camps in Costa Rica, in exchange for Australia's Pacific island refugees.
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Australian refugee camps in Nauru and Papa New Guinea have been criticized by human rights groups for having deplorable conditions, with little to no access to health care and shoddy accommodations.
The agreement, which didn't result in any transfers, was to involve Haitians and Cubans coming to Australia and refugees from the Nauru facility going to the US.
Immigration department chief Michael Pezzullo has told a parliamentary committee the government is working actively on a deal but has claimed a public interest immunity on how many and which countries are in negotiations.
Australia has been in negotiations with third countries to resettle refugees from Nauru and Manus Island, however they remain protracted.
It is also dismissed accusations that it had taken a cruel approach to refugees by pointing out that Australia was set to increase its humanitarian intake to 18,750 by 2018/19.
Observers have been heavily critical of living standards made available to asylum seekers in the centres which have been described as Australia's version of "Guantanamo Bay".
It is understood those who have been judged to be genuine refugees will be given the option of resettling in the third countries or returning to their country of origin as the government seeks to close the offshore detention centres. Hundreds more have come to the Australia for medical treatment and have taken court action to prevent them being send back to the islands. The camps have been controversial amid allegations, from refugees stuck on the islands and among Australians, that the refugees are not being treated humanely.