NICOSIA: Cyprus said on Wednesday it was making good progress with a second round of licensing for exploratory drilling aimed at exploiting offshore oil and gas deposits.
In October drilling permits, subject to negotiation, were approved for blocks 2, 3, 9 and 11, and on Wednesday block 10 was also added to the list.
"Negotiations with applicants for blocks 2 and 3 have made significant progress while progress has been made in negotiations for block 11," said government spokesman Stefanos Stefanou.
However, talks with preferred bidders for block 9 a French-Russian tie-up involving Total ENP Activities and Novatek have ceased, he said.
He said the cabinet had decided direct negotiations should end as they had been "unsatisfactory," and they would now move on to ENI-Kogas.
The government is also negotiating a deal with the same Italian-South Korean partnership for blocks 2 and 3.
France's Total is still in the running to exploit block 11 on its own and the government has also decided to negotiate directly with it for the adjacent block 10.
A launch for tenders for a second licensing round that ended in May covered 12 blocks. A decision on the remaining blocks will be made gradually.
US firm Noble Energy was awarded Block 12 and announced last year that it discovered gas reserves of up to eight trillion cubic feet (226.5 billion cubic metres), which has an estimated value of 100 billion euros ($129 billion).
This would satisfy the island's domestic gas needs for decades.
Media reports predict there could be greater riches, not only of gas but also of oil, in adjacent blocks.
Cyprus hopes its energy bonanza can eventually help pull it out of recession as it seeks an EU bailout.
The island has been divided since 1974, when Turkish troops invaded and occupied its northern third in response to an Athens-engineered coup in Nicosia aimed at union with Greece.
Turkey has protested strongly against the Cyprus government's offshore energy search, branding it illegal and retaliating by beginning its own exploratory drilling off the breakaway north.
Ankara has warned that companies involved in the Cyprus process could be shut out of Turkey's energy investment.
Cyprus President Demetris Christofias has said the oil and gas search would carry on regardless, and that any finds will be used for the benefit of all Cypriots.