An American company is believed to have made an agreement in principle with the Cyprus government to exploit oil and gas in the Exclusive Economic Zone of Cyprus.

The revelation is made by Politis newspaper and comes at a time of heightened tensions off the coast of Cyprus.

The Houston based Nobel Energy company has been named as the interested party.

According to their website, Noble Energy operates offshore installations in multiple countries across the world, including Equatorial Guinea, Israel, the North Sea, Ecuador and China.

Cyprus has this week accused Turkey of harassing two vessels.

One of the ships, with a crew from Norway, was searching for hydrocarbons in Cyprus' exclusive economic zone on November 13, 27 miles off the south coast of the island.