Kenya Production Sharing Contracts signed

PREMIER OIL plc

("Premier" or "the Company")

Kenya Production Sharing Contracts signed

17 May 2011

As announced by BG Group today, Premier is pleased to note the signing of two Production Sharing Contracts for offshore exploration blocks L10A and L10B, between the joint venture partners and the Government of Kenya.

The two blocks cover more than 10,400 square kilometres in the southern portion of the Lamu Basin. Water depth ranges from around 200 metres to in excess of 1,900 metres. The forward plan is to acquire 2D and 3D seismic data in 2011 and 2012.

Premier hold a 20% equity interest in block L10A and a 25% interest in block L10B. BG Group will operate both blocks.

Enquiries

Premier Oil plc 020 7730 1111

Simon Lockett

Pelham Bell Pottinger PR 020 7861 3232

Gavin Davis

Henry Lerwill

Notes to editors:

Partners in the Kenya blocks are: