Minister for Health James Reilly has said the original timescale of 2016 to build the new National Children's Hospital cannot be met.
He confirmed that tomorrow he will bring a memo to Cabinet with a proposal for the best location.
The minister said he hopes a decision would be made and announced tomorrow.
He said the costings he had seen did not support a claim by the Mater Hospital that moving to a new location could cost between €120m and €140m more.
The Mater has also claimed that construction of the new hospital could be delayed by a further two-and-a-half years if an alternative site is chosen.
A site in and around St James's Hospital, with a link to the Coombe Women's Hospital, is seen as the likely proposal to go before Cabinet.
The unpublished Dolphin Report says that due to its scale and complexity, building the hospital will take at least three to three-and-a-half years if it is built on a relatively clear urban site.
It says that overall Connolly Hospital Blanchardstown would offer the fastest building location, saving between six to nine months.
It suggests there would be little difference between the construction time in the case of St James's or the Mater site locations.
If a greenfield site was chosen, the hospital could be built around nine months faster than a relatively clear urban site.