President Jalal Talabani was to officially name Nuri al-Maliki to a second term as Iraq's premier on Thursday, giving him 30 days to form a cabinet after an eight-month impasse since a general election.
The move, delayed to give Maliki as much time as possible to negotiate with his rivals, signals an end to the protracted political battle between Iraq's factions.
The tussle has seen Iraq shatter the world record for the longest period without a new government after polls.
Talabani is expected to name Maliki, who first took the top job in 2006 at a time of brutal sectarian conflict, as prime minister-designate in a ceremony at the president's office, a parliamentary official said, on condition of anonymity.
Under Iraq's constitution, Talabani was allowed 15 days to appoint a prime minister following his re-election by MPs on November 11.
He had earlier been expected to name Maliki as premier last Sunday, immediately after the Muslim holiday of Eid al-Adha, but delayed the decision to give the incumbent more time to negotiate ministerial posts.
The re-selection of Talabani, a Kurd, and Maliki, a Shiite, to their posts and the naming of a Sunni Arab as speaker of parliament came after a power-sharing pact was agreed on November 10.
The accord also established a new statutory body to oversee security as a sop to ex-premier Iyad Allawi, who had held out for months to regain the top job after his Iraqiya bloc narrowly won the most seats in the March 7 poll.
The support of Iraqiya, which garnered most of its seats in Sunni areas of the predominantly Shiite country, is widely seen as vital to preventing a resurgence of inter-confessional violence.
The Sunni minority which dominated Saddam Hussein's regime was the bedrock of the anti-US insurgency after the 2003 invasion.
Despite being lauded by international leaders including US President Barack Obama, the power-sharing pact has looked fragile ever since.
A day after it was agreed, about 60 Iraqiya MPs walked out of a session of parliament, protesting that it was not being honoured.
The bloc's MPs had wanted three of its senior members, barred before the election for their alleged ties to Saddam's banned Baath party, to be reinstated immediately.
Two days later, however, Iraq's lawmakers appeared to have salvaged the deal after leaders from the country's three main parties met and agreed to reconcile and address the MPs' grievances.