Israel and Cyprus launched a joint feasibility study on Sunday, focused on the construction of an underwater power cable between the two countries.
According to the Cyprus Mail, the project aims to boost the two nation's energy security, as well as offer Israel a way to export energy to Europe.
The project is estimated at $660 million, and would eventually become a part of a much longer cable, stretching into Greece and from there to the pan-European electricity grid, the report said.
The project will be headed by the Israel Electric Corp and Cyprus' DEH Quantum Energy.
The planned EuroAsia Interconnector – if approved by all nations involved – will stretch 1,000 kilometers and run some 2,000 meters deep.
It has been lauded as the most ambitions energy project of its kind.
The cable itself will take three years to build. Once completed, it is expected to carry 2,000 megawatts in both directions.
"Israel will no longer be an energy island," IEC Chairman Yiftah Ron-Tal said.
Energy and Water Minister Uzi Landau welcomed the agreement: "This cable would bring us more stability and security." He said.