The decision, confirmed on Friday, means that Chevron can begin drilling immediately in its Lagavulin prospect in waters north of the Shetland isles off the Scottish coast.

Greenpeace, which ended a three-day blockade of the prospect earlier this week after losing a court battle with Chevron, attacked the decision as "bizarre" and said it was preparing legal action to prevent further permits being awarded.

The British government has repeatedly rejected suggestions for a moratorium on deepwater drilling in the North Sea since the BP-operated Macondo well explosion in April that sparked the biggest oil spill in US history.

It argues that regulation in the North Sea is much tougher than in the Gulf of Mexico prior to the BP spill and has also stressed the need for traditional oil and gas until it can wean the country off fossil fuels.

"The government is determined to drive forward our move to a low-carbon economy and develop the UK's renewable energy sources but this cannot happen overnight," the Department of Energy and Climate Change said in a statement on Friday.

"The fact is that in the meantime we will be dependent on oil and gas," it added. "So it is a choice between producing oil and gas here in UK waters, where we have one of the most robust safety and regulatory regimes in the world, with all the economic benefits that will bring, or paying to import oil and gas from elsewhere."

The Energy Department said that lessons learned from Macondo have been applied to the Chevron well and "steps have been taken to prevent the specific failures." Chevron is exploring in waters about 500 m deep. BP's Macondo well, which blew out in the Gulf of Mexico, was about 1.6km deep.

Chevron said it has done "intensive work to ensure that our preparations for this campaign are rigorous."

"We recognize and accept that we have an obligation to the UK public to ensure that vital energy resources are produced safely, reliably and without environmental harm," it added in a statement that cited it's safety record.

The British government has increased the number of rig inspectors in the North Sea — where there is a total of 24 drilling rigs and 280 oil and gas installations — following the Gulf disaster.

But Greenpeace and others seized on a Health and Safety Executive report in August showing a spike in accidental leaks and serious injuries to workers on offshore platforms in 2009/10 as evidence that a moratorium is needed.

Greenpeace said Friday that the remote Languvalin site, 160 miles (257 kilometers) north of Shetland, is home to a delicate ecosystem that includes dolphins and many other species.

"A government claiming to be the greenest ever should be taking us beyond oil, but instead (Energy Minister) Chris Huhne is opening the door for the oil industry and inviting it to drill in ever more dangerous and difficult to reach places," said John Sauven, Greenpeace UK Executive Director.

Greenpeace activists had blocked Chevron's drill ship, the Stena Carron, earlier this week by swimming in front of it and attaching a pod to its anchor chain until ordered to desist by a Scottish court. The group's ship, Esperanza, remains in the area.

Britain tightened regulation in the North Sea after the country's worst offshore accident — the 1998 explosion on the Occidental Oil-owned North Sea Piper Alpha rig that killed 167 workers.