Israel and Cyprus agreed Thursday to launch a joint natural gas and oil exploration venture in their adjoining territorial waters.
The deal will also allow Israel to use Cyprus' air space and territorial waters for aerial and naval search and rescue drills.
The Prime Minister's Office said that the deal was inked as part of the two nations' efforts to "strengthen the improving ties between the two nations, as well as boost energy security in both countries."
Netanyahu traveled to Cyprus with a mission of 20 high-level government officials, including Energy and Water Minister Uzi Landau and the directors of Israel's National Security and National Economic councils.
In January, Israel and Cyprus signed two defense agreements, which Cypriot Minister of Defense Demetris Eliades said "sets the basis for the further development of relations in the area of defense cooperation."
Reuters contributed to this report