OSLO (Reuters) - Norway gave Statoil the go-ahead to start drilling the world's most northerly oil well in the Barents Sea by rejecting an appeal by environment group Greenpeace to block the exploration.
Oil drillers in Norway are moving further north as mature fields in the south deplete and the Arctic ice retreats opening new areas that were previously unaccessible.
U.S. estimates show the Arctic may hold 13 percent of the world's undiscovered oil and 30 percent of its gas.
A Ministry of Climate and Environment spokesman on Friday confirmed a statement from Statoil that it had rejected Greenpeace's appeal and drilling could go ahead.
Greenpeace had argued that Statoil's drilling plans posed a threat to Bear Island, an uninhabited wildlife sanctuary that is home to rare species including polar bears, as an oil spill would be nearly impossible to clean up in the Arctic because of the harsh conditions.
Statoil rejected the claim saying there was a very low risk of an oil spill, and an extremely low risk of any spillage reaching Bear Island, about 170 km away from the drilling site.
"Statoil is thus permitted to conduct the drilling operation as planned, including drilling in oil-bearing layers," the state-controlled company said.
"Our top priority is to have safe operations without any harm to people or the environment," said Irene Rummelhoff, Statoil's senior vice president for exploration on the Norwegian continental shelf.
Greenpeace, which calls Statoil an "Arctic aggressor", said it will continue to block the drilling site with its ship Esperanza after Norwegian police removed its seven protesters from Transocean's Spitsbergen rig, which arrived on Thursday.
"We will continue our legal occupation of the drilling site. We have not received any request from authorities to leave, therefore we consider it to be legal," Greenpeace's Truls Gulowsen told Reuters.
The company said delays to the start of drilling cost the company about 7.5 million crowns ($1.26 million) per day.
The Norwegian Ministry of Oil and Energy declared a safety zone around the drilling site to stop the blockade, but Greenpeace said its lawyers have appealed against the decision.
The activists taken off the rig - from Denmark, Finland, Norway, the Philippines and Sweden - were released without charge and were all well, Gulowsen said.
This summer, Statoil plans to drill three wells on the Apollo, Atlantis and Mercury prospects in the Hoop area, some 300 km away from the mainland.
Reporting by Nerijus Adomaitis; Editing by Erica Billingham