In addition to the extension, Premier Darrell Dexter said Monday his government has arranged for Talbot House to receive help from Wayne Yorke, an expert in the addiction services field, as it prepares its proposal.
The government previously issued a request for proposals to organizations interested in offering addictions services in Cape Breton.
But the board of directors at Talbot House said they would not submit a proposal because the Aug. 28 deadline was unrealistic.
Board chairman John Gainer said he learned of the deadline extension Monday after receiving a call from Dexter.
"It came as quite a pleasant surprise," he said in an interview, adding that no one from Talbot House had requested more time to put together a proposal.
"Overall, the indication was that (Dexter) is sincerely interested in resolving this problem and being able to restore Talbot House."
Still, Gainer said the board wants some details cleared up before it commits to submitting a proposal, including what Yorke's role will be in the process and who will be responsible for selecting the successful proposal.
The Frenchvale facility closed its doors in March in the middle of an organizational review by the Community Services Department. It was launched after a complaint from a former resident.
Community Services Minister Denise Peterson-Rafuse has said the $420,000 funding for Talbot House was only discontinued when the board told her department it was closing during the review.
The review, which the board vigorously challenged, concluded the facility hadn't been operating in compliance with provincial standards. It also found there was no evidence its 10-member board had been actively overseeing the facility's operation.
Dexter said in a statement that it's been a difficult few months for Talbot House, which had been in operation for more than 50 years.
"It's time to resolve this issue and ensure people receive the help they need to recover from addictions," he said.
Brooke Armstrong, a spokeswoman for the Premier's Office, said a new deadline hasn't yet been set and she was unsure how many proposals the government had already received.
Liberal Opposition Leader Stephen McNeil said the government should restore funding to Talbot House without asking the centre to take part in what he called a "flawed" proposal process.
"By extending the (request for proposals) deadline, the premier is at least signalling his government is beginning to understand the importance of Talbot House," he said in a statement.
Progressive Conservative critic Keith Bain said the successful proposal should be decided by addictions specialists, not officials with Community Services or the same person who authored the organizational review.
Gainer previously dismissed the review of Talbot House saying it contained "sufficient errors, inaccuracies and misrepresentations."
However, he also conceded that Talbot House had failed to meet provincial standards.
Earlier this year, police announced they had dropped an investigation into the actions of Rev. Paul Abbass, who was director of Talbot House.
Abbass was suspended from his duties in the Roman Catholic diocese after someone from Talbot House complained to police in February.