Since the vessel arrived last week, Shell is free to drill into oil-bearing rock, estimated at 8,000 feet below the ocean floor, for the first time since its last exploratory well was drilled in 1991.

"Activities conducted offshore Alaska are being held to the highest safety, environmental protection and emergency response standards," agency Director Brian Salerno said in a statement Monday. "We will continue to monitor their work around the clock to ensure the utmost safety and environmental stewardship."

Environmental groups oppose Arctic offshore drilling, saying industrial activity will harm polar bears, Pacific walrus, ice seals and threatened whales already vulnerable from climate warming and shrinking summer sea ice. They say oil companies have not demonstrated that they can clean up a spill in water choked by ice.

Monday's announcement, which drew criticism from environmentalists, comes a week after President Barack Obama said he would visit Alaskan Arctic communities threatened by climate change.

"Last week President Obama said climate change puts Alaska at the 'front lines of one of the greatest challenges we face this century,' and yet today he approved Shell's plans to drill for oil in the Alaskan Arctic," Greenpeace USA Executive Director Annie Leonard said in an emailed statement.

"The president cannot have it both ways," she said, calling the approval "deeply hypocritical."

The U.S. Geological Survey estimates that U.S. Arctic waters hold 26 billion barrels of recoverable oil, and Shell is eager to explore in a basin that company officials say could be a game changer for domestic production.

Shell bid $2.1 billion on Chukchi Sea leases in 2008 and has spent upward of $7 billion on exploration there and in the Beaufort Sea off Alaska's north coast.

The company hopes to drill two exploration wells in 2015 during the short open-water season. It has until late September, when all work must stop. It has two drill vessels and about 28 support vessels in the Chukchi Sea.

The permit to drill deep below the ocean hinged on the arrival of a capping stack, which is a roughly 30-foot device that can be lowered over a wellhead to act like a spigot to stop a blowout. The government requires Shell to have the device ready to use within 24 hours of a blowout.

The capping stack sits on the Fennica, a 380-foot icebreaker that suffered hull damage July 3 as it left Dutch Harbor, a port in the Aleutian Islands. The vessel was repaired in Portland, Oregon, and was briefly delayed from leaving July 30 by Greenpeace protesters in climbing gear hanging from a bridge over the Willamette River.

The Fennica reached the drill site, 70 miles off Alaska's northwest coast, Aug. 11.

Al Jazeera and The Associated Press