The Habs, led by GM Marc Bergevin, have been in talks with the representatives for Diaz, P.K. Subban and Andrei Markov, all of whom need new contracts.
Diaz's agent, Don Meehan, who also represents Subban along with Mark Guy of Newport Sports Management, told TFP Editor-in-Chief David Pagnotta on Monday that talks are "ongoing" with the Canadiens.
Negotiations are expected to continue throughout the season until deal is reached or until it has become clear that an extension is not in the cards.
Diaz is making $1.255 million this season and could see his salary climb over $2 million, per year, on a new contract.
In 27 games with the Canadiens so far this season, Diaz has registered eight assists and a plus-two rating.
Meanwhile, Bergevin continues to field calls from several teams inquiring about trade possibilities.
The Canadiens have been scouting a number of teams this season, and will have Director of Player Development Scott Mellanby in attendance for tonight's Winnipeg Jets at New York Rangers matchup.