Cyprus and France's Total signed a memorandum of understanding on Thursday on the feasibility of participating in an LNG project on the island.
Total's subsidiary Total E&P Cyprus received a concession to explore for hydrocarbons in two areas offshore in February.
The MoU recorded the support of Total for the monetisation of potential gas reserves in both blocks, through a variety of options, giving priority to liquefaction and LNG export to European and Asian markets, Cypriot authorities said in a statement.
Cyprus discovered natural gas offshore in 2011, following major finds by neighbouring Israel in the east Mediterranean over the past three years. U.S. based Noble reported last month it had found around 5 trillion cubic feet of gas in one area south of the island.
That company is also engaged in talks with Cypriot authorities for the development of the LNG terminal.
Cyprus hopes the terminal, which will cost about $6 billion to build, will be used as a hub for exports from the region. Energy officials estimate work could tentatively start in 2016 to facilitate exports by around 2020.
In addition to Noble and Total, Cyprus has signed production sharing contracts with Italy's ENI and South Korea's Kogas.