The deal was announced by the team the day after the conclusion of the 2014 Tour de France, where the 28 year old placed 22nd overall behind winner Vincenzo Nibali (Astana) and was the only British rider to finish the race in Paris.
"I'm really happy to be staying with Team Sky for another two years. I've been here since the start and I firmly believe it is the best place for me to fulfill my potential as a bike rider," said Thomas in a team statement.
"I feel very supported here and I'm excited about what the future holds. I'll look forward to challenging myself both on and off the bike and striving to become the very best at what I do."
Team principal Dave Brailsford added: "Team Sky has always been built around a strong British core - developing and nurturing home-grown talent to be the best they can be – and Geraint has been at the heart of that.
"On and off the bike, Geraint is an influential member of Team Sky. Not only is he a strong character but he’s one of a handful of world-class riders that can do it all, whether that’s on the climbs, flat, cobbles or time trials, which proves what a valuable member of the team he is.
"Over the last three weeks of the Tour de France Geraint has underlined his qualities again and shown that he’s an exceptional rider with an exciting future. He’s a great guy, a good leader and we’re delighted that he’ll be a key part of the team going forward."
Thomas has been touted as a future Grand Tour contender in his own right, but told Cycling Weekly during the Tour that he's happy in his team support role for now: "If I was the leader and was in another team, I’d be around there, if not a bit better,” Thomas said of his overall standing in the race. "It’s not that I think about, though. It’s all about the team."
Thomas won Bayern Rundfahrt in June for a second time, he also put in a strong ride in the 2014 Paris-Roubaix, finishing seventh. Despite his road success, he is probably best known for being double Olympic champion in the team pursuit (2008 and 2012). His next race will be the Commonwealth Games time trial in Glasgow on Thursday, July 31, where he will represent Wales.
Welshman Geraint Thomas finishes Tour de France before racing to Commonwealth Games
Geraint Thomas is supporting Richie Porte at the Tour de France, but hoping for a chance to lead a team
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