Knights officials have denied suggestions explosive forward Herman Ese'ese is unwanted by the club for next season but concede re-signing him "is going to be difficult".
Over the past few days, the former Kiwi international prop has been strongly linked to a move to the Gold Coast Titans for 2021 with the Knights telling his management they are not yet in a position to make an offer because of salary cap constraints.
Ese'ese is one of three players currently in talks with the club over their futures. Prop Jacob Saitifi and utility star Connor Watson are also among the club's retention priorities with Saifiti very close to confirming he will be staying.
Saifiti's form this season alongside twin brother Daniel has been outstanding and he has no interest in leaving Newcastle.
His re-signing on a short-term contract could be announced within the next week. But there is still plenty of work to be done to get Watson and Ese'ese over the line.
The signing of Dragons international Tyson Frizell on a three year deal worth around $2.1 million as well as an upgrade for fullback Kalyn Ponga as part of his extended $4 million plus four year deal has put significant pressure on the club's cap.
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Knights recruitment boss Alex McKinnon told the Newcastle Herald Ese'ese's future is up in the air.
"Adam [coach O'Brien] is keen to keep Herman but at the moment, salary cap-wise, it is going to be difficult," McKinnon said.
"It's definitely not a no. We are definitely interested in keeping him if we can. But at the moment, it is going to take time for us to work out whether we can potentially move a player or to see what money we have left following other negotiations.
"Also, we still don't really know what the salary cap figure is even going to be next year so it's difficult to work out bonuses and what part of any bonuses might have to sit in the cap.
"We just don't have a great understanding of how much money we will have so they are the issues we are facing."
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Even if the Knights do get themselves into a position to come up with an offer for Ese'ese, it may not be enough to entice him to stay.
Ironically, the Titans made a $1 million offer over two years for Ese'ese at the start of this season after they lost prop Ryan James to a season-ending injury.
But O'Brien, who arrived at the Knights with a high opinion of Ese'ese and his attacking threat, wasn't prepared to release him from the final year of his contract and the Titans signed Sam Lisone from the Warriors instead.
Ese'ese' manager Simon Mammino has virtually conceded the Titans are the frontrunner for the Knights prop's signature despite also being in the market for Broncos backrower David Fifita.
"The Titans are definitely an option for Herman," Mammino told the Courier-Mail.
"His partner has family in Queensland and he went to school in Brisbane so he is looking to play for the Titans.
"I am talking to a few clubs and then I am waiting to hear back from Newcastle. He has a few options but Herman is looking to come home."
McKinnon conceded the 25-year-old prop may not be in a position to wait for the Knights to come up with a new deal.
"Unfortunately, that's the position we are in and they are aware of that," he said.
Ese'ese, Watson and Saifiti are among a group of players off contract for next season that also includes the likes of Aidan Guerra, Tautau Moga, Josh King and Mason Lino.
No final decisions have been made on their futures but the likelihood is some will go. McKinnon said the club's strong start to the season meant there will be retention challenges.
"The reality is the team is going well so people's values go up," he said.
"It's a bit different to before. It makes it easier to attract people, some people will stay for a bit less but unfortunately, some people are going to get squeezed out as well."