Bluebird K7, the legendary hydroplane relaunched earlier this year, is returning to her "spiritual home" in the Lake District next year.

Sky News understands that, following years of being unable to reach agreement, "obstacles" preventing the historic craft from a fanfare homecoming in Coniston are being swept away.

The decision is expected to be approved at a meeting later today and is expected to result in an event attracting thousands of extra tourists and sightseers from around the world.

Bluebird set seven world water speed records before crashing on Coniston Water in 1967 killing her pilot Donald Campbell.

K7 was the first jet-powered hydroplane and became known throughout the world for her revolutionary design. Television images of Mr Campbell's accident on the Cumbrian lake propelled him to even greater fame.

Thirty-four years after Bluebird sank to the bed of Coniston Water she and her pilot were relocated by divers and lifted to the surface.

Several years of negotiations between the team who restored Bluebird and the Lake District authorities failed to strike a deal on what was planned to be a triumphant return to Coniston.

Instead the restoration project leader Bill Smith took the hydroplane to the Isle of Bute in Scotland where she was greeted by large crowds and successfully relaunched at demonstration speeds of 150 mph.

At the time of the two-week long trials in August this year Bill Smith said: "People say she should go to Coniston but Coniston simply has nothing in place to facilitate this despite a decade to get it ready and that is tragic. It shouldn't have happened that way."

Bluebird gets second life

Bluebird gets second life

The day Bluebird rose from the dead

Anne Hall, a district councillor in Coniston, denied that there had been "bureaucratic resistance" to Bluebird's return.

She said: "We raised £580,000 to build a home for it in the Ruskin Museum here. We have worked on this for years and years.

"It will be quite amazing to see it on the lake. Donald was very special to us."

The councillor added that there had been "compromise on both sides" in agreeing arrangements for the "homecoming."

If formally agreed Bluebird K7 is expected to make its first run on Coniston Water since the 1967 crash in July 2019.