Johnston became only the second man to bring up 200 career tries on Sunday, scoring a hat-trick in the Rabbitohs 36-30 loss to the Warriors.
The 30-year-old's haul put him within 12 tries of Ken Irvine's record tally of 212, which has stood since the North Sydney and Manly great's retirement in 1973.
Johnston is off contract at the end of this year, and there had been concerns last summer his deal would not be extended beyond the end of 2025.
But AAP has been told talks are ramping up around a new deal, with the Rabbitohs and Johnston's management meeting as recently as last week.
They are expected to speak again shortly, and it is understood the two parties are nutting out the finer details.
That will mean Johnston has more than just this year to break Irvine's record, after a season-ending achilles injury last year threatened to derail his push.
"I know (Souths part-owner) Russell Crowe is really proud of him too," coach Wayne Bennett said.
"It's really important to him that Alex Johnston remains on the wing here as long as he can get the job done. And I feel the same.
"He means a lot to the fans. He looks like breaking a record that has been there for a long time.
"A great day for him, and it's not over yet."
Johnston cut an emotional figure after fulltime, and was given a rousing reception by Rabbitohs fans at Accor Stadium on scoring this 200th late in the match.
"I'd be emotional too," Bennett said.
"They go through a lot these guys ... their careers depend on their bodies, and his was not in a good place.
"He's a pretty special player. He is so good.
"He is not only a good athlete, but he is also pretty smart with the way he positions himself and works it all out when we get near the tryline.
"If he's a couple of metres away from the tryline, the way he keeps the ball up in the air ... you don't have long to think about that stuff, but he gets it right."
Johnston admitted afterwards he now has Irvine in his sights.
"The crowd started going crazy, and I was almost tearing up," Johnston told Fox League's broadcast.
"There have been some dark times in the past 12 months, but it was good to contribute.
"Every single person on the street brings up (212), so it's hard not to (think of it). My goal this year was to get to 200, and I've got there now.
"Everything else is a cherry on top, and hopefully I get there."
The winger's haul was a bright spot for Souths, who lost Bailey Bentley-Hape to a groin injury and had Jai Arrow playing hooker at one stage due to the reshuffle.
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