Hamilton set to be offered 'staggering' new contract by Mercedes

There has been much speculation over the future of Lewis Hamilton in F1, with his contract set to expire at the end of 2018, but it appears that Mercedes are set to offer their world champion a game-changing new contract to extend his stay in the sport.

It has been widely reported that the four-time world champion is set to agree terms on a three-year, £120m relationship ensuring his involvement in Formula 1 until 2021.

This deal would eclipse his current £100m deal as Mercedes look to fend off potential interest from rivals Ferrari or Red Bull.

Hamilton has been vague about his future in F1, making cryptic statements recently about having 'other challenges' beyond the track, but on other occasions he has issued his desire to chase down Michael Schumacher's record seven world championship titles.

However it seems that with such a lucrative offer on the table, Hamilton will readily accept and is set to guarantee his stay into the next decade.

It is thought that this agreement will move Hamilton into line with Vettel's salary at Ferrari; the German has led the way over the last few seasons in terms of earnings and this deal will create a clear gap between these two rivals and the rest of the grid.

Hamilton has been celebrating his world championship this week with his Mercedes team, and he was thankful for the efforts of his entire pit team for making the season such a success.

He said: "It is something that I will never forget, turning up at the front gate of the factory and seeing everyone out on the street to welcome me - I'm blown away.

"This has been an incredible year, it's been an incredible journey together. There's a huge amount of respect and appreciation I have for everyone."