The striker's current deal, worth £60,000 per week, runs out in the summer of 2005, but since the Steve McManaman fiasco the club have always wanted to agree new contracts two years before renewal.
Owen and Steven Gerrard are keen to be playing Champions League football and want some reassurance that the club are heading in the right direction before putting pen to paper.
But Owen has admitted that the club have been in touch and negotiations will commence shortly.
"The club have approached me and indicated they are ready to talk," he said. "They haven't set a date yet, but I'm sure we will be sitting down shortly to discuss things."
Will Owen stay at Liverpool?
Owen and Steven Gerrard are keen to be playing Champions League football and want some reassurance that the club are heading in the right direction before putting pen to paper.
But Owen has admitted that the club have been in touch and negotiations will commence shortly.
"The club have approached me and indicated they are ready to talk," he said. "They haven't set a date yet, but I'm sure we will be sitting down shortly to discuss things."
Will Owen stay at Liverpool?