Bream sale and purchase agreement signed

PREMIER OIL plc

("Premier" or "the Company")

Bream sale and purchase agreement signed

30 May 2012

Premier is pleased to announce that it has signed a sale and purchase agreement (SPA) with Skeie Energy AS to acquire a 20 per cent equity interest in PL407 and a 40 per cent equity interest in the adjacent PL406 licence on the Norwegian Continental Shelf, subject to approval from the Norwegian Authorities. This will increase Premier's stake in the Bream project to 40 per cent and the company's operated interest in PL406 to 80 per cent. Premier will pay an upfront consideration of $10 million to Skeie with further payments of up to $17.5 million contingent upon certain milestones being reached.

Project sanction of the Bream development is planned for the second half of 2012. First oil is targeted for late 2015 with an initial production rate of approximately 14,000 bopd net to Premier, upon completion of the transaction.

Simon Lockett, Chief Executive, commented:

"We are delighted to have this opportunity to increase our interest in the Bream project, which is making good progress towards project sanction. This transaction further demonstrates our commitment to becoming a full cycle E&P company in Norway."

Enquiries

Premier Oil plc 020 7730 1111

Simon Lockett

Tony Durrant

Pelham Bell Pottinger 020 7861 3232

Gavin Davis

Henry Lerwill