The master plan for the expanded knowledge quarter has been released and a Merseyrail station for Paddington is mentioned, again and even appears on one of the CGIs. See Revealed: billion-pound Liverpool masterplan to create THOUSANDS of jobs and transform part of city. Other than a connection to central it doesn't say much else about it.
In my blog A New Edge Hill, I speculated that it was the resurrection of the Edge Hill Spur scheme, part of the original plan for Merseyrail(MALTS). This would involve building tunnels along the route in yellow and blue below. This would require about 1 mile of new tunnel.
AlternativeSome have suggested the alternative below, which uses more of the length of the Victoria/Waterloo tunnel and about half a mile of new tunnels, to connect to Merseyrail north of Moorfields. The light blue section is the new tunnels.
While the new tunnels may be half the length of the MALTS scheme, overall length is longer, as a much longer section of the old tunnel is used, and while tunnelling may be thought to be the expensive bit, building the stations is far more expensive and restoring the old tunnel will not be cheap. Once you have got all the kit on site and people trained up the difference in cost will be minimal. It is also unlikely that this northern junction could be constructed without interfering with services. The preparatory work in the 70s done for the Edge Hill spur, south of central makes that much more likely.
The major argument against this plan is service provision, currently the northern line at Moorefields has 12 trains per hour passing in each direction, any new service would have to fit into that.
Then there is the question of where the trains will go after central, currently of the 3 services running into central only the Southport service continues on to Hunts Cross. The other two either sit at a platform or use the reversing siding, this was not what the station was designed for, it was designed with the Edge Hill spur in mind so that all services would pass through, 1 of the terminating services would have gone on to St Helens and another to the outer loop or perhaps Widnes South. Adding an extra service, which terminated, would most likely mean adding an extra platform which would not be cheap.
The Edge Hill spur scheme could add access to both old tunnels, so that, eventually, more city centre stations could be added, with connections to central and possibly the airport.