Drilling update - Catcher North

PREMIER OIL plc

("Premier" or "the Company")

Drilling update - Catcher North

8th February 2011

Premier announces that the Catcher North well (UK28/9-03) located in the UK Central North Sea, has encountered gas and oil bearing sandstones.

The well was drilled to a total depth of 5265 feet (ft) Measured Depth (MD).

Initial analysis indicates a total of 34ft of net hydrocarbon pay. This total net pay comprises 20ft net gas pay in the Tay sandstones and 14ft of oil pay in the Cromarty sandstones; the latter is at the bottom end of Premier's pre-drill predictions.

The Catcher North well was purposely located to penetrate the Cromarty reservoir in an area with less seismic amplitude response than that observed over the equivalent section at Catcher. As a result of the lower than expected oil pay encountered at Catcher North, Premier now estimates the overall oil reserves range for the combined Catcher, Catcher North and Catcher East discoveries at between 40 mmbbls and 80 mmbbls.

The Catcher North well will now be plugged and abandoned before moving to the Burgman prospect some 7 km southwest of Catcher North. 

Premier has 35% equity in licence P1430. 

Simon Lockett, Chief Executive Officer, commented:

"Whilst the Tay result was in line with Premier's pre-drill expectations, the Cromarty result was a disappointment. The results of this well will now be integrated into the planned development for Catcher and the understanding of the Cromarty reservoir distribution across the licence. We look forward to the results of the upcoming Burgman well, and thereafter Carnaby."

Enquiries

Premier Oil plc 020 7730 1111

Simon Lockett

Andrew Lodge

Pelham Bell Pottinger PR

Gavin Davis 07910 104 660