UPDATE 2-Greenpeace ship arrives at Arctic drill site, Statoil rig within sight
* Rig arrives at site on Thursday afternoon
* Protest mounted two days ago when 15 activists boarded rig
* Norway police removed 7 remaining protesters on Thursday
* Legal challenge stops Statoil starting full drilling (Adds rig now within sight of ship)
By Gwladys Fouche
OSLO, May 29 (Reuters) - A Greenpeace ship arrived on Thursday at the Arctic location where Norway's Statoil is planning to drill the world's most northerly oil well, ahead of the company's rig which was making its way to the site.
By late afternoon the rig was approaching the ship. "It is within sight, it is standing by," said Greenpeace's Truls Gulowsen.
Earlier in the day, Norwegian police had removed seven Greenpeace protesters who had boarded the rig to stop it getting to the Barents Sea and Bear Island, an uninhabited wildlife sanctuary which is home to rare species, including polar bears.
Greenpeace, which calls Statoil an "Arctic aggressor", wants to stop oil firms drilling further north than ever before as the Arctic ice retreats and a relaxing of the law allows companies to work in areas where winter ice was common just decades ago.
"The Greenpeace ship Esperanza is blocking the arrival of Statoil's Transocean Spitsbergen oil rig in the Arctic by occupying the exact location where the company plans to drill the world's northernmost well," the group said a statement.
The activists taken off the rig - from Denmark, Finland, Norway, the Philippines and Sweden - were released without charge and were all well, Gulowsen said.
One Finnish woman among them had been in the group of 30 Greenpeace activists detained by Russian authorities for two months for climbing aboard an Arctic oil rig last September.
Gulowsen said there were people from 16 different nations aboard the Esperanza.
The Statoil rig will not be able to start full drilling operations until Norway's government decides on a Greenpeace appeal against it.
"Statoil has a permit to start the drilling operations, but awaits a final decision on a Greenpeace appeal to the Norwegian Ministry of climate and environment before drilling into oil-bearing layers," said the firm.
It is unclear how long the appeal could take. (Editing by Stephen Addison)