Cairn Energy, which completed an initial season of exploratory drilling off Greenland this summer, will be joined by a further six oil and gas firms with rights to explore off the country's south-western shores.
In a competition the Greenland government described as "fierce", winning companies were Royal Dutch Shell, GDF Suez, ConocoPhillips, Maersk, Dong Energy and the national oil company of Greenland, Nunaoil.
The government's bureau of minerals and petroleum said 12 international oil companies had vied for 17 blocks.
Cairn was awarded three new fields bringing its total acreage offshore Greenland to 81,000sq km.
Simon Thomson, legal and commercial director for Cairn, said he "welcomed" the Greenland government's decision to award it three blocks and confirmed there will be a signing ceremony in Greenland later this week to seal the deal.
The long-awaited announcement means further drilling could start in as little as two years, although most companies said any drilling on the back of favourable seismic results would probably commence in three to five years.
Ove Karl Berthelsen, Greenland's minister for industry and mineral resources, said the licensing round was "an important step towards achieving a sustainable economy for Greenland", which is a semi-autonomous territory controlled by Denmark.
He added: "Safety has top priority and I shall be looking forward to following the results of their work,"
Peter Hitchens at Panmure Gordon said Cairn was likely to continue pressing ahead of its rivals in searching for oil in Greenland, which the US Geological Survey estimates could hold 50 billion barrels of crude and gas.
"The big companies tend to be slower-moving because it is just another licence in their portfolios, whereas Cairn really want to accelerate Greenland and get that up running as fast as possible," said Hitchens.
He added that the move to open Greenland was a sign of an "appetite for exploration" as major oil firms struggle to find new sources of oil.
"The general feeling is they will have to take more risks then they have done - doing a bit more frontier exploration.That is high-risk as in chances of success rather than risk of accident."
But green campaigners targeted Cairn's exploration efforts this summer, calling for a moratorium on exploration in the region's pristine Arctic waters in the wake of the devastating accident in the Gulf of Mexico.
Ben Ayliffe, senior energy solutions campaigner for Greenpeace, warned the area where the new licences were awarded was even more difficult to explore being hundreds of miles further north than Cairn's current prospect.
Ayliffe said: "We have tried to show to the public and investors that companies like BP and Cairn are taking more and more risks to get their hands on the last drops of oil on the planet."