Cities Minister Greg Clark has confirmed that the Tees Valley's city deal bid will now go through to the next stage.
The next stage will work towards determining which powers can be transferred to a local level, in order to determine the detail before a final decision can be made.
Durham Tees Valley Airport will reapply for Government money for a development project to safeguard its future operations. It follows a failed bid for £5.9m from the Regional Growth Fund in 2012.
£350m is up for grabs in the next round of funding. The airport has earmarked the site for a proposed freight terminal development.
The Business Secretary Vince Cable has told Teesside MPs that his department is analysing a submission by the airport following its recent failure to win a grant under the government's Regional Growth Fund.
Mr Cable was responding to a question by the Stockton North MP Alex Cunningham who met ministers to discuss the airport's critical importance to the wider Teesside economy.
Radical plans for a major international airport in the North East - even larger than Manchester's - have been put forward.
A transport expert from Middlesbrough says that it is the only way that the region can compete in the future.
If the idea is approved the new airport would be built near Peterlee, replacing Newcastle and Durham Tees Valley Airports, but many say that the idea has a slim chance of becoming a reality.
The company behind proposals for a new international airport to be built in the region have released an image of what the airport might look like.
The plans are currently only an idea, but if given the go ahead the airport would supersede both Newcastle and Durham Tees Valley airports and be built near Peterlee.
Plans for a new major international airport to be built in the North East have been put forward by a transport expert from Middlesbrough.
The airport would be built north of Peterlee, replacing the region's existing airports, and it is expected that it would be bigger than Manchester Airport.
Transport architect Tim Narey believes that a new airport for the North East should be as big as it can possibly be.
A transport expert from Middlesbrough has put forward the idea for a new major airport to be built in the North East.
The new international airport would replace the existing airports at Durham Tees Valley and Newcastle, and would be built north of Peterlee.
If the idea is approved the new airport could be bigger than the airport in Manchester.
You can watch the full report from Rachel Bullock below:
The Business Secretary is looking again at a failed bid from Durham Tees Valley airport to win a 6 million pounds government grant.
The cash would fund a site development that may be critical to the airport's future
Two local MPs met Mr Cable, after the airport lost out on the funding last month.
It comes at a time when there has already been a measured drop in passenger numbers, and warnings over the airport's sustainability.
Durham Tees Valley Airport is applying for £5.9 million towards plans it says would generate 1500 new jobs.Read the full story ›