But in another twist to the long running saga, the site's owners - who recently announced they planned to build a five storey restaurant on the site - have now also asked for financial compensation for the income they will forego if the restaurant complex is not built.

Napoli said the owners' had demanded between $5-10 million in additional compensation if the proposed restaurant complex was not built. The proposed restaurant building would have had a monument to the victims on the building's top, fifth storey.

“I am very reluctant to even entertain their claims for compensation for the potential of lost income," Napoli said.

Napoli recently met Morrison, who has described the proposed restaurant development as "deeply disturbing", when the prime minister was on a campaign stop in Perth.

He said the prime minister had indicated to him the Australian government was prepared to consider making up the shortfall in money raised by the Bali Peace Park Association to buy the land.

In a separate communication, Napoli said Shorten had offered bipartisan support for any funding deal that was struck and that it would be delivered if Labor won government, too.

The association has raised close to a million dollars from donations since it was established and to date, federal and state governments have promised close to another million dollars to find the memorial.

In practice, that would mean the Australian government would have to spend at least another $3 million to pay for the site to be purchased - and potentially several million more - to build the peace park, before the new compensation claim was even factored in.

“We hope that we will be able to, with the collaboration of Balinese officials, achieve a result for the victims and survivors of the atrocity that occurred in 2002," Napoli said.

“Monday was a long and difficult day of negotiations and we hope and pray that an outcome that satisfies all that are interested and involved is achieved”.

If a deal is not done by Thursday, when the restaurant construction is due to start, Napoli is prepared to walk away from negotiations and give up on the project entirely.

It's understood that Bali Governor Wayan Koster has flagged with the current site owners a new plot of land a couple of kilometres from the bombing site in exchange for the Sari Club land, to try and help smooth the way to securing the deal.

Back in 2010 the site owners had asked for more than $20 million, but that price has come down in recent years to about $5 million – a figure that the association had still not been able to meet.

The 2002 attacks on the Sari Club and the nearby Paddy's Bar killed 202 people, including 88 Australians.

The proposal to build a memorial on the fifth storey of a restaurant complex sparked fury from some of the survivors of the bombing.

But some locals supported the development of the restaurant complex as it would provide employment, because the site is a dirt car park and an eyesore, and because there is a memorial across the road.

Morrison recently spoke to President Joko Widodo, and his office did not deny the Peace Park had been discussed. His office would not comment on the negotiations over the land when contacted for comment.