The information comes from two sources within the American administration and suggests that Greenland is to be proposed to enter into an agreement on free association with the USA, a so-called "Compact of Free Association".
This type of agreement has previously been used to tie closer bonds with the small Pacific nations of Micronesia, Marshall Islands and Palau.
The agreements imply that the countries remain independent, while the USA is responsible for basic services such as postal services, rescue services and defense. In exchange, American military can move freely and trade with the USA is essentially tax-free.
Greenland, however, is not an independent state but a self-governing part of Denmark. Opinion polls show that many are in favor of independence from Denmark, but few want to belong to the USA.
According to Reuters' sources, a number of practical obstacles remain before it can become a reality. It should not be the only plan being considered either.
President Donald Trump has since his return to the White House hard on the fact that the USA needs Greenland for security reasons and has not wanted to rule out taking the island by force.
Greenland and Denmark have rejected the overtures.
