Exploration Drilling Update

PREMIER OIL plc

("Premier" or "the Company")

Exploration Drilling Update, Nam Con Son Basin, Indonesia and Vietnam

12 August 2011

Belut Laut-1 (Tuna Block, Indonesia, Premier 65% equity)

The Belut Laut-1 exploration well has reached the planned total depth of 4,948 metres. Oil shows with high gas readings were reported from a depth of 4,740 metres throughout a gross 155 metre Oligocene sandstone interval. However, logs indicated that the sandstones at this depth were of poor porosity. The well will therefore be plugged and abandoned with oil and gas shows.

Belut Laut, along with Gajah Laut Utara-1 and the successful appraisal of the Ca Rong Do discovery (CRD-2x) in Vietnam earlier this year, has confirmed the potential for hydrocarbons within the Oligocene section in the Nam Con Son basin. The ongoing sub-surface interpretation will now be focussed to prospects at shallower depths where good reservoir properties are preserved up dip from proven source rocks. At least five such prospects have been identified in the Tuna acreage and also in the neighbouring Block 07/03 in Vietnam. Premier plans to drill the first of these in the second half of 2012.

CS-N2P (Block 12W, Vietnam, Premier 53.125%)

The CS-N2P well, a development production well for the Chim Sáo project, has intersected the shallow part of a previously undrilled fault terrace to the north west of the Chim Sáo field. Based on Logging While Drilling data, the well encountered a 20 metre oil column in an independent closure within good quality Upper Dua Sandstones. The plan is to appraise this new accumulation as a near-field tie-back opportunity via the CS-N1P development well, through which wire-line logs and fluid samples will be acquired. The results of this well are expected in October.

Simon Lockett, Chief Executive Officer, commented

"We have learnt from the wells drilled on the Tuna acreage and will now target lookalike prospects in the Nam Con Son basin where the Oligocene reservoirs are at shallower depths and are therefore of better quality.

The discovery of new resources close to the Chim Sáo development is very encouraging and we look forward to the appraisal results later this year."

Enquiries

Premier Oil plc 020 7730 1111

Simon Lockett

Andrew Lodge

Pelham Bell Pottinger PR 020 7861 3232

Gavin Davis

Henry Lerwill