Interim Management Statement

PREMIER OIL plc

("Premier" or "the Company")

Interim Management Statement

Premier today provides its Interim Management Statement for the period to 15 November 2011.

HIGHLIGHTS

·; Premier's two significant Asian developments are now onstream. Chim Sáo is producing 25-30 kbopd, which is ahead of expectations. Gajah Baru is expected to average 60 bbtud for the remainder of the year, before ramping up, and is meeting current customer nominations of up to 90 bbtud.

·; 2011 production guidance of 40-45 kboepd remains unchanged. Premier continues to expect a run rate of 60 kboepd by the end of 2011 and to target 100 kboepd in the medium term.

·; First oil from the Huntington field is expected in September 2012, as previously guided, and Premier reiterates its production run rate target of 75 kboepd by the end of 2012.

·; The recommended acquisition of EnCore is on track to complete in January 2012. Upon completion, Premier has agreed to the on-sale of EnCore's interest in Cladhan to TAQA for a cash consideration of $54.8 million.

·; A programme of 25 wells is planned over the next 13 months with unrisked resource potential in excess of 200 mmboe, net to Premier. This includes 6 wells in the important Eocene play fairway in the Central North Sea where Premier has a growing position.

·; Premier has also agreed to purchase Nexen's operated interests in three Norwegian licences, subject to government and partner approvals, which are close to the Company's existing acreage in the Norwegian North Sea.

Simon Lockett, Chief Executive, commented:

"It is extremely pleasing to see such good early performance from our newly producing operated fields in Asia which keeps us on track to achieve rapidly growing near term cash flow. Having delivered successfully in Asia, the focus for investment activities now shifts back to the North Sea where we continue to build another high quality business with significant upside potential. This is an exciting time for Premier and its shareholders."

Enquiries

Premier Oil plc Tel: 020 7730 1111

Simon Lockett

Tony Durrant

Pelham Bell Pottinger

Gavin Davis Tel: 020 7861 3159

Henry LerwillProduction Operations

Premier reiterates its 2011 average production guidance of 40-45 kboepd and confirms that it expects to deliver a run rate of 60 kboepd by year end. The Company is also targeting a run rate of 75 kboepd by the end of 2012, once the Huntington and Rochelle fields are onstream, and 100 kboepd in the medium term.

Chim Sáo

First oil from the Chim Sáo field in Vietnam was achieved on 10 October 2011 and the field is currently delivering ahead of expectations at 25-30 kbopd from six producing wells. Water injection is scheduled to commence shortly. Gas export is also expected to start within the month which, together with the associated liquids, will add a further 6 kboepd (gross) to Chim Sáo production. The development drilling programme will continue into next year including an additional appraisal well into the recently discovered Chim Sáo North West area. Liftings from the field commenced in November with cargoes sold at a premium to average dated Brent.

Gajah Baru

The Gajah Baru facilities in Indonesia are fully commissioned and delivering to Singapore in accordance with the 2008 Gas Sales Agreement. Production is expected to average 60 bbtud for the remainder of the year, while ramping up. The field is meeting current customer nominations of up to 90 bbtud. An additional 40 bbtud of gas from Gajah Baru is planned to be delivered to Java, Indonesia, via a Swap Agreement, completion of which is expected soon.

Following the successful development drilling programme, the Gajah Baru field has deliverability well in excess of the contracted quantities of 130 bbtud.

Wytch Farm

The acquisition of the additional 17.715% equity in Wytch Farm, UK, is expected to be completed during December 2011.

Development projects

Huntington

Good progress has been made on the Huntington development in recent months, with phase 1 subsea installation complete, and drilling progressing ahead of schedule.

As previously announced, Teekay Corporation (Teekay) has agreed to acquire the Voyageur FPSO from Sevan Marine, and is financing the completion of the vessel upgrade. Teekay is also close to agreeing a Heads of Terms with the operator of the Huntington field around the existing charter contract, with signature expected shortly. Sail-away is targeted for July 2012 with first oil in September 2012, in line with previous guidance.

Catcher

Premier's recommended acquisition of EnCore, announced on 5 October 2011, is progressing to schedule. Documents for the recommended acquisition are due to be published on 18 November prior to EnCore's general meeting on 12 December. The prospectus will include a Competent Person's Report covering Premier. It is anticipated that the acquisition will complete in January 2012.

On completion of the acquisition, Premier will increase its stake to 50% and become operator of the UK Catcher development; building on its exploration position in related Central North Sea plays. A drilling programme of up to three wells, on Catcher and related blocks, is expected to commence with the spudding of the Carnaby prospect in early 2012.

Premier has agreed with TAQA Bratani Limited (TAQA) that, upon completion of the EnCore acquisition, it will on-sell the 16.6% interest in the Cladhan area, which it will have indirectly acquired from the EnCore acquisition. The cash consideration will be $54.8 million, which includes an allocation for tax allowances. Cladhan is in the Northern North Sea and is therefore outside Premier's core area of focus.

TAQA has also agreed on completion of the EnCore acquisition to farm into a 50% interest in Block 28/10a (currently 100% EnCore), which includes the Coaster prospect, on a promoted basis under which it will pay 80% of certain well costs and 50% of back costs. It is anticipated that the drilling of the Coaster prospect will form part of the 2012 drilling programme. TAQA will also be transferred certain contractual rights connected with a joint study and bidding agreement.

Premier's agreement with TAQA prohibits TAQA from competing against Premier for the acquisition of EnCore or any of EnCore's assets or interests. The agreement is available for viewing on Premier's website at www.premier-oil.com.

Exploration

Exploration and appraisal programme

25 exploration and appraisal wells are drilling or planned for the remainder of 2011 and 2012, with unrisked net prospective resource potential, on a mean basis, in excess of 200 mmboe. This includes 6 wells in the important Eocene play fairway in the Central North Sea where Premier has a growing position and an extensive knowledge base.

1operator's estimate

The following wells in EnCore's exploration portfolio are planned to be drilled later this year or during 2012:

250% on completion of TAQA farm-in

UK

8 of the wells planned for the remainder of 2011 and 2012 are located in the Eocene play fairway, a key strategic area for Premier. This includes the Erne exploration well, which spudded on 12 November, and is targeting an Eocene Tay Formation, about six kilometres north east of the Premier-operated Fyne Field. If successful, a discovery would be tied back to a production hub over Fyne.

EnCore's Tudor Rose well, which is expected to spud imminently, is appraising a heavy oil discovery in the Central North Sea. Following completion of the drilling, the rig will drill the Premier-operated East Fyne Appraisal well which, like the Erne well, is targeting the Eocene Tay Sands. The rig will then drill the Bluebell prospect, also in the Central North Sea.

Norway

The results of the Gardrofa well, Premier's first operated well in Norway, are expected imminently. Gardrofa is adjacent to Premier's Bream development and, if successful, will impact the development options for the project.

Elsewhere in the Norwegian North Sea, Premier has a 30% interest in PL359, which contains the Luno II prospect on the southwest margin of the Utsira High. Following on from the recent discoveries in this play, the operator, Lundin, plans to drill an exploration well to test the Luno II prospect in mid-2012.

Premier continues to build on its exploration portfolio in Norway. The Company has agreed with Nexen Exploration Norge to purchase its interests in three licences - PL539 (40%), PL566S (50%) and PL 565 (60%) - for a cash consideration of $5.5 million. Premier will also seek to secure operatorship of these licences, subject to government and partner approval. This acreage lies adjacent to the Premier-operated PL567 and builds on Premier's knowledge in this area. The prospectivity flanks the Mandal high with target intervals in the Jurassic sands.

Premier has also made three applications in the recent Norwegian APA licence round. The results of the licensing round are expected in early 2012.

Asia

Earlier this year Premier deviated two wells into the fault terrace to the north west of the Chim Sáo field and encountered oil bearing sandstones. An initial gross resource range of 7-12 mmbo with further potential upside is estimated. The company plans to appraise this upside in 2012, following the completion of the Chim Sáo development drilling programme.

Premier is in the process of integrating the results from its 2011 exploration drilling campaign in the Nam Con Son Basin. Interpretation of these results has shown that the Oligocene sandstone reservoirs have more potential than previously considered, and hence exploration focus is shifting to these, in addition to remaining Miocene targets. As such, Premier plans to return to exploration drilling in the Nam Con Son Basin at the end of 2012.

Kenya

Acquisition of 2D and 3D seismic across Premier's two blocks, L10A and L10B, offshore Kenya is expected to commence on 15 November 2011. Premier's partners in the two blocks, which cover more than 10,000 square kilometres, are BG (operator), Cove Energy and Pancontinental. Premier has a 20% and 25% interest in L10A and L10B respectively.

Mauritania

In October, new PSC arrangements were agreed with the Government of Mauritania. Once ratified, Premier will have a 6.23% in the new PSC, which is known as PSC-C10 and replaces the existing PSC-Area A and PSC-Area B, with Tullow as operator. Plans are in place to progress the existing Banda, Tiof and Tevet discoveries and to initiate an exploration programme in the new contract area which covers 10,725 square kilometres. An exploration well, targeting the underexplored Cretaceous play, is planned for 2012.

Finance

Capital expenditure for 2011 is expected to be in line with previous guidance of around $750 million. Net debt is approximately $740 million at 31 October 2011 with cash and undrawn facilities of $1.1 billion.

Future Announcements

Premier's 2011 Preliminary Results will be announced on Thursday 22 March 2012. A Trading and Operations Update is planned for Thursday 19 January 2011.