Exploration Investor Presentation January 2010

January 2010 | Page 1

Forward looking statements

This presentation may contain forward-looking statements and information that both represents management's current expectations or beliefs concerning future events and are subject to known and unknown risks and uncertainties.

A number of factors could cause actual results, performance or events to differ materially from those expressed or implied by

these forward-looking statements.

January 2010 | Page 2

Target

• Build three quality businesses which deliver 100 kboepd from 400 mmbbls of reserves

Strategy

• Attain 75 kboepd from 2P reserves of 265 mmboe

• Commercialise contingent resource base of 180 mmboe

• Add 200 mmboe of2P reserves from exploration

• Make value-adding acquisitions in three core areas

• Maintain a conservative financing plan

Exploration is a fundamental part of Premier’s growth strategy

Target and strategy

January 2010 | Page 3

2009• Premier added 20 mmboe to 45 mmboe of net

resources• 5 exploration and 2 appraisal wells (excl Egypt;

now sold)• Exploration success rate: 40%• Finding cost: $4/boe

2010-2012• Unrisked target resource: 800 mmboe• Risked resource target: 100 mmboe• 12 Exploration and appraisal wells planned in 2010• Material prospects targeted• Drilling candidates from existing portfolio

2012 to 2014• Resource additions must come from success case

follow on and/or new ventures

Add 200 mmboe net reserves by 2015

Exploration – Targets

250

200

100

50

02009 2010 2011

150

300

2012 2013 2014

350

400Success Case/NV UnriskedSuccess Case/NV RiskedUnriskedRiskedCum risked additions

Global Exploration:Forecast 2C resource additions (mmboe)

January 2010 | Page 4

The majority of the worlds petroleum resources are found in 3 basin types:• Rift Basins: e.g. North Sea, SE Asia, onshore Africa and West Siberia• Passive Margins: e.g. West Africa / SE Brazil, NW Australia and the Gulf of Mexico• Fold-belts / Forelands: Columbia, Iran / Iraq and Pakistan

Premier has a competitive advantage in value creating exploration of Rifts and Fold-belts / Forelands

Premier will continue to explore the rift basins of SE Asia and the North Sea and will look to exploit its competitive advantages in selected rifts and fold-belt basins of Africa, the Middle East and Central Asia

Premier – Petroleum basin focus

January 2010 | Page 5

• Premier began exploring in 1986, initially via entry into SE Asia

• To date Premier has discovered net 800 mmboe at an overall commercial success rate of 22%

• The commercial discoveries have been made in two basin types:1) Rifts: Southeast Asia and Norway2) Frontal Fold-belts: Pakistan

• The success rate in these basin types is ~40%

• Since 2000 the exploration success has been dominated by Rift Basin exploration in Asia and latterly in Norway

Exploration – Historic performance

800

Premier Discoveries 1986-2009* (net mmboe)

500

400

200

100

01985 1990

300

600

700

1995 2000 2005 2010

* Does not include Egypt

Annual discoveriesCumulative annualdiscoveries

January 2010 | Page 6

Exploration strategy

Near-term programme• Asia: Nam Con Son Basin (Vietnam and Indonesia)

• North Sea: UK Central North Sea and Norwegian North Sea

New Venture Activity• Rift Basins: new acreage in the North Sea, Asia and potentially North/East

Africa or Central Asia

• Frontal Fold-belt plays: new acreage in the Middle East or Central Asia

The goal is to deliver 200mmboe 2P reserves through the drill bitfocussing on areas where we have demonstrated skills and expertise

January 2010 | Page 7

Exploration outlook – January 2010

Contingent WellsFirm Wells: Rig Contracted Firm Wells: Rig TBC Seismic Programme

All well timings are subject to revision for operational reasons

Unrisked net potential of 350mmboe

Pirkoh-1QadirpurPakistan

Middle East/PakistanOatesP1620

CatcherP1430

Bugle AppraisalP815UK

Grosbeak AppraisalPL378

GnatcatcherPL378

GardrofaPL406 (8/3)

Greater LunoPL359 (16/1,4)

BlabaerPL374S (34/2,5)Norway

North SeaLead BButon

Prospect B

Prospect ATunaIndonesia

Seismic104/109-05

Seismic (contingent)07/03Vietnam

Q4Q3Q2Q12010Asia

Transocean Winner

Bredford Dolphin

Transocean GSF Arctic IV

Galaxy II (STC)

Maersk Guardian

January 2010 | Page 8

Premier equities• 07/03: 30% and operator• Tuna: 65% and operator, target equity 40% pre-drill

Prospectivity• 10-15 leads and prospects• Cá Rồng Đó discovery May 2009 (10 mmbo to 70

mmbo gross resource)• Cá Rồng Vang - P&A December 2009• Resource potential 30-100 mmbo per prospect

2010 Plan• Fully interpret existing 3D• Acquire 3D over central part of Block 7/03• Drill 2 Tuna prospects

2011 Plan• Appraise Cá Rồng Đó discovery • Drill further exploration wells in 07/03

An integrated play-based approach to exploration

Exploration – Vietnam / Indonesia – Nam Con Son

January 2010 | Page 9

CRV

Amplitude analysis of 3D is potentially the key to unlocking the prize

NW

CRD / CRD North East

CRD Discovery

SE

Exploration – Block 07/03 – CRD discovery and CRV

Low amplitude area dueto gas in overburden

Anomalies associatedwith Hydrocarbons

Anomalies associatedwith Hydrocarbons?

Gas above CRD

January 2010 | Page 10

Exploration – Tuna – Regional prospectivity

Numerous material drillable prospects being defined on new 3D

NW SE

Plan to drill 2 prospects in Q3/Q4 2010Gajah Laut UtaraCacing LautSinga / Kuda Laut

Gabus

MMU

Base Muda

Basement

Arang

Top Oil Expulsion

ThermallyMature Source

ThermallyMature Source

January 2010 | Page 11

• Active 2010 programme targeting50- 200 mmboe net to Premier:

Prospect Potential(mmboe gross)

Gnatcatcher 31-60 mmboeGardrofa 15-115 mmboeGreater Luno 30-150 mmboeBlåbaer 15-75 mmboeBugle North 7-39 mmboeOates 25-107 mmboeCatcher 18-33 mmboe

• Preparing for 2011 drilling, e.g. Moth/Lacewing

Gnatcatcher

Moth/Lacewing

Gardrofa

Greater Luno

Blåbaer

Bugle Appraisal

Bream

Oates

Catcher

Premier’s rift basin expertise is being applied to the North Sea

Exploration – North Sea

January 2010 | Page 12

Huntington• Premier equity in Block 22/14b is 40% • Concept selection process ongoing• First production forecast for 2012• Unitization process underway• Exploration focus is to Pre-Tertiary potential

Moth• Appraisal of Moth and potentially a deep pre-

Cretaceous target (Lacewing) planned for 2011• Premier equity ~50% (BG operator)

Oates• Premier 50% equity and operator*• Oates prospect has 25 mmboe to 107 mmboe

potential• Low to moderate risk

* Subject to DECC approval

Building a new core area in the UK Central North Sea Rift basin

Exploration – Huntington, Moth and Oates

January 2010 | Page 13

Exploration – UK – Oates

Oates (P1620)• Premier 50% equity and operator• Reserve estimate 25-65-107 mmboe• Amplitude supported stratigraphic trap• Low to moderate risk for oil and gas• Drilling planned late Q2/Early Q3 2010• Follow up potential exists at Bowers

(10-65 mmboe unrisked reserves)

Oates

Bowers

Forties Isopach Map

OatesNW SE

Amplitude Bloom on Far Stacks

January 2010 | Page 14

Blåbaer Jordbaer

Blåbaer (PL374)• Premier 15% equity• Operated by BG• Reserves estimate 15-30-75 mmboe• Moderate risk for oil• Well status: drilling• Jordbaer project moving forward

Exploration – Norway – Blåbaer

January 2010 | Page 15

Exploration – Norway – Greater Luno

Greater Luno (Pl 359)• Premier 30% equity• Operated by Lundin• Targeting basement and possible Jurassic sandstones

related to the Luno discovery (95 mmboe) on adjacent Lundin-operated block

• Estimated reserve range 30-150 mmboe• Moderate risk for oil• Drilling planned for Q1 2010

16/4-5 Planned Well Location

Greater Luno

January 2010 | Page 16

Exploration – Norway – Bream, Gardrofa

Bream (PL 406)• Brent age oil discovered 1971, close to Yme Field• In 2009,17/12-4 and its sidetracks wells appraised

this discovery, testing 2,516 boepd• Operated by BG, Premier equity 20%• Estimated reserves 39-50-63 mmboe• Plan of development under review

Gardrofa (PL407)• Premier’s first operated licence in Norway• Premier equity 40%• Untested trap flanking a Salt dome feature• Estimated reserves 15-70-115 mmboe• Moderate risk for oil• Well planned for Q3 2010

9/1-1 Gardrofa Prospect Well Location

Success at Gardrofa will lead to a new core area for Premier in Norway

January 2010 | Page 17

Exploration challenges

1. Access to new opportunities in themes of choice

2. Maintaining exploration focus/discipline

3. Managing the natural tension between growth ambitions and the production/development of existing resources

4. Building a geoscience organisation for the future

January 2010 | Page 18

Exploration strategy

Near-term programme• Asia: Nam Con Son Basin (Vietnam and Indonesia)

• North Sea: UK Central North Sea and Norwegian North Sea

New Venture Activity• Rift Basins: new acreage in the North Sea, Asia and potentially North/East

Africa or Central Asia

• Frontal Fold-belt plays: new acreage in the Middle East or Central Asia

The goal is to deliver 200mmboe 2P reserves through the drill bitfocussing on areas where we have demonstrated skills and expertise

January 2010 | Page 19

Look forward

End 2012

• Significantly increased reserve base

• Run-rate production of 75 kboepd with related cash flow expansion

• Follow-on portfolio of development projects to add 10-15 kboepd

• Fully evaluated Nam Con Son basin opportunity

• Replenished exploration portfolio in areas of existing geological knowledge

End 2010

• Stable production from established assets

• Development drilling commenced on key projects in Indonesia and Vietnam

• New project approvals e.g. Dua, Bream, Bugle, Fife, Frøy

• Twelve well exploration programme completed

• 10-20 prospects brought to drillable status for 2011/2012 programme

January 2010 | Page 20

Appendix

January 2010 | Page 21

Exploration – Norway – Grosbeak, Gnatcatcher

Gnatcatcher/Grosbeak (PL 378)• Premier 20% equity (non-operated)• Successful Grosbeak well completed in July 2009

– Close to nearby infrastructure– Oil in Middle Jurassic sandstones– Estimated reserves 30-90-170 mmboe

• Gnatcatcher resource estimate 31-40-60 mmboe• Moderate to High risk for oil• Q3 2010 Gnatcatcher Exploration well and Q4 probable

Grosbeak appraisalGnatcatcher

SW NE

January 2010 | Page 22

Exploration – UK – Bugle North

Bugle North (P815)• Premier 41% equity, likely to move to 50%• Nexen operator• Nearfield exploration opportunity• Gross reserves estimate 7-17-39 mmboe• Adjacent Bugle discovery flowed 7,398 bopd and 9.06 mmscfd gas• Drilling planned for Q1 2010

January 2010 | Page 23

Moth (P1181)

• 50% equity in 23/21

• 57.5% operated equity in 23/22b

• 70% operated equity in 7/7d and 7/10a

• Moth discovery max flow rate 24.4 mmscfd gas and 2460 bopd

• Appraisal of Moth and potentially a deep pre-Cretaceous target (Lacewing) are under evaluation

• Drilling planned 2011

Exploration – UK – Moth

January 2010 | Page 24

Exploration – UK – Catcher

2 Km

Catcher (P1430)• Premier equity 50%• Encore operator• Reserves estimates 18-25-33 mmboe• Low risk for gas• Drilling planned Q2 2010

CatcherWTop Cromarty depth Map E

Balder

Chalk

Top Cromarty

Phase Change

2 Km

Blocks28/9 & 10c

January 2010 | Page 25

Exploration – Indonesia – Buton

meters

‘B’

Buton PSC• Premier equity 30%• Japex operator• Lead B reserve estimates 35-100-300 mmboe• High risk for oil• Prospect maturation ongoing• Drilling planned Q4 2010/Q1 2011

Lead BNW SE

0 5000

January 2010 | Page 26

North Sea / West AfricaAsiaMiddle East-Pakistan

Premier Oil – a snapshot

500

Reserves and resources(mmboe)

2005

400

0

200

300

2006 2007 2008 Proforma30/6/09

100

181

265

2009Production by type

2009Commodity price exposure

Production by region(kboepd)

Reserves and resources by category(mmboe, at 30 June 2009)

2009 2013

62% 38% 16.0 17.2

11.0Direct oil price linkedRegulated gas pricing

Reserves by region(mmboe, at 30 June 2009)

49 59

157

53 158

235

North Sea / West AfricaAsiaMiddle East-Pakistan

181 121

144

In productionIn developmentContingent resources

39% 61%

OilGas

2C reserves2P reserves

Reserves and resources by region(mmboe, at 30 June 2009)

44.2

265 446446

15.5 21.0

41.0

77.4

North Sea / West AfricaAsiaMiddle East-Pakistan

January 2010 | Page 27www.premier-oil.com January 2010