The Dragons will announce in coming days Molo has been released from the final year and a half of his contract, ending a two-month long dispute.
The resolution comes after Molo had taken a leave of absence from Dragons training since early this year after taking umbrage with a comment from a coach.
AAP has been told part of Molo's exit includes a termination fee with the prop to pay back a sizeable sum in order to break the contract.
The former Queensland State of Origin prop is expected to be in the eyes of several clubs after not attending Dragons training since early this year.
Molo's contract dispute had proven a constant headache for the Dragons as they were unable to sign a replacement for their most powerful prop given their top-30 roster was full.
Club officials at one stage approached the NRL for help on how to handle the matter, but were unable to secure dispensation.
They eventually released winger Mikaele Ravalawa to South Sydney for the rest of the season last week, allowing them to sign former Test prop David Klemmer.
But Molo's exit will clear significant salary-cap space, given he was on a deal in the vicinity of $550,000 per year for both 2025 and 2026.
The settlement means the vast majority of Molo's salary will not be counted in this year's cap, while his entire salary will be wiped from the 2026 cap.
There is also now one spot free on the Dragons' 2025 30-man roster.
Beyond Klemmer's arrival, St George Illawarra have enjoyed some relief in the forwards with Blake Lawrie returning from injury last week against South Sydney.
Hame Sele and Tom Eisenhuth are also both due back in coming weeks after the Dragons round-three bye.
But after prop Ryan Couchman suffered a season-ending ACL rupture, it's likely the Dragons would like to fill their 30th roster spot with a forward if one becomes available.
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