2011 Annual Results Presentation 22 March 2012 Forward looking - - PowerPoint PPT Presentation

2011 Annual Results Presentation

22 March 2012

22nd March 2012 | 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.

22nd March 2012 | Page 2

Agenda

Premier today 2011 financial results Operations update Exploration update Summary Simon Lockett Tony Durrant Neil Hawkings Andrew Lodge Simon Lockett

22nd March 2012 | Page 3

Over the last 6 years …

40% 338% 72% 80% Over the period, NAV/share CAGR of 14.2% excluding oil price effects

22nd March 2012 | Page 4

Premier today...

Acquire Licence Gate Drill Decision Gate Appraisal Approval Gate Project Extension Gate

MEAP North Sea Asia

Appraise Drill Evaluate

LEADS PROSPECTS MATURE PROSPECTS

... is in the strongest position in its history

• Clear path to 100,000 boepd

from existing projects

• >1.5 billion of prospective

resources in the exploration portfolio

• Fully funded programme with

strong and rising cash flows

• Proven capability to deliver

across the portfolio

22nd March 2012 | Page 5

2011 highlights...

• Increased production to 60,000 boepd at year end

– Chim Sáo and Gajah Baru onstream – Next generation of development projects progressing

• Increased reserves and resources to 527 mmboe

– Exploration success at ~$5/bbl post-tax – Acquisitions at ~$8/bbl

• Increased financial strength

– Cash and undrawn facilities of ~$1.4 billion – Strongly rising cash flows – Record profitability – Continued access to bond and bank markets at favourable rates

22nd March 2012 | Page 6

2011 financial results

22nd March 2012 | Page 7

Record profitability

12 months to 31 Dec 2010 Operating costs ($/bbl) 2011 2010 UK $39.5 $28.7 Indonesia $11.1 $8.5 Pakistan $2.4 $2.0 Vietnam $16.6 – Group $15.9 $13.9 Highlights 12 months to 31 Dec 2011 Working Interest production (kboepd) Entitlement production (kboepd) Realised oil price ($/bbl) – pre hedge Realised gas price ($/mcf) – pre hedge Sales and other operating revenues Cost of sales Gross profit Exploration/New Business General and administration costs Operating profit Financial items Profit before taxation Taxation credit Profit after tax 42.8 38.3 79.7 6.3 $m 764 (531) 233 (87) (18) 128 (27) 101 29 130 40.4 37.7 111.9 8.5 $m 827 (415) 412 (211) (25) 176 (34) 142 29 171

• Net impact on 2011 of $23 million

post-tax

• 25% of 2012 production hedged at

average of $100/bbl

• Minimal hedging beyond 2012
• All b/fwd losses recognised as

deferred tax asset

• $1.36 billion allowances carried

forward into 2012

• No UK CT cash taxes until 2018 under

existing model using $75/bbl Hedging Taxation

22nd March 2012 | Page 8

Rising cash flows

Cash flow from operations Taxation Operating cash flow Capital expenditure (Acquisitions)/disposals, net Finance and other charges, net Pre-licence expenditure Net cash flow 12 months to 31 Dec 2010 $m

2011 Development Exploration

Estimated capex split ($m)

433 228 661

Regional split ($m)

505 (69) 436 (514) 13 (70) (19) (154) 12 months to 31 Dec 2011 $m

2010 349 165 514

530 (44) 486 (661) (90) (50) (23) (338)

North Sea $302m Asia $301m Total $661m MEAP $58m

Outlook

• Operating cash flow increased by 11%; significant growth expected in 2012

22nd March 2012 | Page 9

Strong liquidity position

Cash Bank debt Bonds Convertibles Net debt position Pro forma Gearing Cash and undrawn facilities at 31 Dec 2010 $m 300 (488) ( – ) (218) (406) 26% 1,202 at 31 Dec 2011 $m 309 (484) (341) (228) (744) 30% 1,116

Outlook

• Current debt funding costs average 5% (fixed) and 3% (floating)
• Additional bank and bond debt raised post year-end of $585 million raising cash

and undrawn facilities (after some debt repayment) to $1,400 million by mid-March

22nd March 2012 | Page 10

Fully funded programme

1400

Investment Profile (US$ million)

400 200 500 700 900 2013 2012 2015 800 600 100 300 2014 1000 1100

Exploration Expenditure Development Capex

1300 1200

Note: assumes exploration expenditure of $250 mm pa from 2013

2012 outlook

• Forecast full-year 2012 spend of ~$740

million (development) and $220 million (exploration)

• Total capex covered by cash flow for 2012

at current spot prices Forward funding

• Forward profile funded by cash flow and

facilities even at $60/bbl

• Significant capacity to increase spend on

exploration and new development projects Outlook

• Rising production generates $2 billion post-tax cash flow in 2015 at $100/bbl

22nd March 2012 | Page 11

Operations update

22nd March 2012 | Page 12

Operations highlights

• Chim Sáo and Gajah Baru onstream in October

– Deliverability exceeding expectations

• Realising further value from producing assets
• Continued progress on the development

portfolio: – Huntington and Rochelle progressing – Solan project sanction expected soon – Development studies for Catcher well- advanced

• On track to reach 75,000 boepd run rate by

year end 2012, once Huntington and Rochelle

• nstream
• Anticipate reaching 100,000 boepd when

Catcher comes onstream in 2015

22nd March 2012 | Page 13

Production update

• Year-end target of 60,000 boepd achieved

– Full year production 40,420 boepd – Strong gas demand in Pakistan and Indonesia, combined with good facilities performance – Improved Balmoral production in H2, as maintenance issues were progressed

• Wytch Farm acquisition adds ~2,500 boepd net
• Production at Kyle (1,760 bopd) shut-in since

December 2011

• 2012 full year production forecast 60,000-

65,000 boepd, with key variables being – Timing of Huntington first production – Ability to capitalise on excess deliverability at Chim Sáo and Gajah Baru

50

Production (working interest) (kboepd net)

20 10 60 2007 2010 2008 2009 2012E 30

Asia MEAP North Sea

2011 40 70

22nd March 2012 | Page 14

Natuna ‘A’ 2015

Block A – strong production performance

Anoa & GSA1

• Producing at current maximum capacity

– 170-180 BBtud

• Phase 4 expansion project underway

– Raising capacity to 200 BBtud

• Pelikan will add 70 BBtud of capacity

Gajah Baru & GSA2/3/4

• Currently producing at 60-90 BBtud
• DCQ increases from 50 to 90 BBtud at end Q1

– 200 BBtud well deliverability

• Indonesia will shortly take an additional 40 BBtud

when the domestic swap agreement is signed Outlook

• Series of new field developments will maintain rates
• Exploration is adding additional reserves

22nd March 2012 | Page 15

Singapore Gas Market – sales are increasing

Singapore demand for gas will increase

• Existing pipeline supplies are naturally declining
• LNG supplies must commence and increase
• But supply diversity will be maintained, and be

underpinned by 90% Take or Pay contracts

• GSA1 demand expected to remain between DCQ

and Max Rate (341-392 BBtud) Premier’s GSA1 market share is increasing

• Block A contractual market share of GSA1 is 37%

– 2011 Block A actual share of deliveries was 42% – Block A share of remaining reserves dedicated to GSA1 has increased to 59% – Other GSA 1 suppliers are expected to drop to 150-100 BBtud in 2015-2016

• GSA 1 market available to Block A could increase

to 200-250 BBtud in 2015-2016

22nd March 2012 | Page 16

Chim Sáo – delivered and ramping up

• First oil achieved, safely and on budget, in

October 2011

• Currently producing 25,000-30,000 bopd

– Gas exports add a further ~4,000 boepd – Rates limited due to water injection delays – 9 production wells could reach 40,000 bopd – Vessel capacity is 50,000 bopd

• MDS5/6 reserves have increased by

10 mmbo

22nd March 2012 | Page 17

Chim Sáo – uncovering upside potential

Chim Sáo North West

• Chim Sáo North West discovered in August 2011
• Additional gross resource estimate 13 to 20 mmbo
• Near vertical appraisal well scheduled for mid-2012
• Development will be via existing facilities

Additional Reservoirs

• Further reserves potential is being

found in reservoirs other than MDS5/6 Tie-in of Dua

• Government of Vietnam approved

ODP in December 2011

• Long lead items being purchased
• Project sanction expected 1H 2012,

first oil 2014

2000m 3060mss

Chim Sáo

West Closure Far Closure Near Closure

22nd March 2012 | Page 18

Kadanwari – getting more from a mature field

Kadanwari field

• Came onstream in 1995
• Highest gas price in Pakistan
• 2008-2012, five new gas compartments discovered:

– K-27 tied-in to system at 45 mmscfd in 2012 – K-28 and K-30, which tested at 30 mmscfd and 50 mmscfd respectively, will be tied-in by mid-2012

• Production levels expected to be at 110 mmscfd

during 2012-2014

• Further exploration well planned for 4Q 2012

Upside potential

• 550 bcf of tight gas potential identified in 2011
• 3 well pilot project planned for 2012

22nd March 2012 | Page 19

Wytch Farm – motivated operator finding upside

Increased equity

• Increased Working Interest in Wytch Farm by

17.715% to 30.1% in 2011 – ~4,500 boepd of net production in 2012 – Adds ~11 mmboe of net reserves Upside potential

• Initiated active drilling programme to 2017 and

beyond to increase deliverability – Infill drilling in producing reservoirs to accelerate production and optimise recovery – Bringing into production of satellite discoveries onshore

• Long term production and reserves upside

through waterflood optimisation and EOR

• Working with new operator Perenco to

maximise value

22nd March 2012 | Page 20

Huntington and Rochelle – progressing to first oil

• Successful development drilling campaign
• Phase 1 sub-sea installation completed
• CATS gas transportation agreement signed and

shuttle tanker contract awarded

• Upgrade of the Voyageur FPSO proceeding
• Operator is expecting first oil in Q4 2012
• Rochelle area agreement executed May 2011
• Approval of FDP for East and West Rochelle

in 2011

• Scott platform modifications underway
• Subsea installation to commence in June 2012
• First gas expected in November 2012

Huntington Rochelle

22nd March 2012 | Page 21

• Premier is Operator with 60% equity
• Development Concept:

– Subsea wells and storage tank – Processing deck on a conventional jacket – Reserves estimate ~ 40 mmbo – Initial rate of 22,000 bopd – Capex of ~$850 mm with $30 mm/year opex

• Premier will provide Chrysaor with:

– $50 million carry – Corporate loan for the balance of their equity – Loan recovered through Chrysaor’s cash flow

• Will qualify for new “Small Fields Allowance”
• Internal approvals are in place and seeking

partner and DECC approvals before end April

Solan – approaching project sanction

22nd March 2012 | Page 22

Catcher Area – selecting a development concept

• Further 2011 drilling resulted in:

– STOIIP estimates of ~260-290 MMSTB – Reserves estimates of 80-130 MMSTB – Production rate of 50-70,000 bopd

• EnCore acquisition has completed

– Premier in place as Operator with 50% equity

• Conceptual Engineering studies completed

– Capex estimates range from $1.6bn for a leased FPSO to $2.8bn for a central fixed platform – JV concept selection process is underway

• New “Small Fields Allowance” will apply to seperate

accumulations on block

• Targeting sanction by year-end with first oil in 2015

FPSO and Subsea Wells CPP, Bridge-linked WHP and Subsea Wells

22nd March 2012 | Page 23

Reserves and resources – continuing growth

600

2007

450 400 350 150 200 250 300

2008 2009

100 50

Reserves and contingent resources (mmboe)

Production Additions & Revisions End 2011 2010 2C contingent resources 2P reserves

296

550 500

230 227 261

Reserve replacement ratio of 333%

22nd March 2012 | Page 24

A clear path to 100,000 boepd

120,000

Production outlook (bbls/day)

40,000 20,000 60,000 2012 2014 2013 2016 100,000 80,000 2015 1100

Development capex (US$ million)

400 200 500 700 900 2013 2012 2015 800 600 100 300 2014 1000 2016

At $100/bbl, expect post tax cash flow of ~$2 billion in 2015

Pre-Development Sanctioned Projects On Production

22nd March 2012 | Page 25

Exploration update

22nd March 2012 | Page 26

• Focus on geologies we know well

– Rifts or frontal fold belts

• Target best plays in basins of

choice – Play master approach

• Deliver 200 mmboe of 2P reserve

additions by end 2014

• Invest up to 30% of annual cash

flows in exploration

• Gated process to decision making

Exploration strategy

Old New Old

• 1. Premier capabilities

and niche strategies

• 3. Technology capabilities

and resource diversification

• pportunities

Old New

• 2. Leverage Premier

capabilities in new areas

• 4. Identify long term
• pportunities for

growth and approach to de-risk investment

New Old New Geographies Themes Themes Geographies

Asia

MEAP & Exploration New Business

North Sea

22nd March 2012 | Page 27

2011 highlights

Exploration drilling

• Notable discoveries at Burgman in the Catcher

area in the UK, and CRD and Chim Sáo North West in Vietnam

• 12 out of 21 exploration and appraisal wells drilled

in 2011 successful

• Additional successes to date in 2012 with Anoa

Deep in Indonesia and K-30 in Pakistan

• Remain on track to deliver 200 mmboe by end

2014 – 70 mmboe added to date New ventures

• 2011 highly successful for new acreage capture in

Norway, UK and Kenya

• With lead and prospect maturation, greater visibility

for 2014 and beyond

200 100 50 150

2012 2013 2014

450

Actual & forecast risked resource additions 2009-2015 (mmboe)

2009 Actual

400 350 300 250

2010 Actual 2011 Actual 2015

Actual cumulative plus possible resources Cumulative risked prospective resource additions Risked prospective resource additions Actual proved plus probable additions

• Unrisked prospective portfolio of >1.5 billion boe

(350 mmboe risked)

22nd March 2012 | Page 28

Norway PL378: Grosbeak UK P1875 Erne

Stingray

Norway PL374S: Blabaer

Bonneville Carnaby

Vietnam Block 12W: CS NW

Appraise Drill Evaluate

Acquire Licence Gate Drill Decision Gate Appraisal Approval Gate Project Extension Gate

MEAP North Sea Asia

Pre- Development

Spaniards Coaster Cougar Rapide Rocket K-32 Badhra South Badhra-7 New York Typhoon Lacewing Cyclone Tupai Anakonda B Sedang Kakak Tua B Kecil Sambar CRT Silver Sillago Singa / Kuda Laut Peudawa Rayeu Alur Kacang Biawak Besar Matang Benteng Baroosh Badhra-6 Parh

Vietnam Block 12W: CS Cau Vietnam Block 087/03 CRD Pakistan Kadanwari K-30

Norfolk Moth E. Moth S. Cornet

LEADS PROSPECTS

Dino

Recent acquisitions add to overall portfolio value

Luno II

MATURE PROSPECTS UNDER APPRAISAL

<10 <100 >100 >250 Net NPV10 $mm >10 >25 >50 <10 Net EMV10 $mm

(shown as circle inside NPV)

Acreage acquired in 2011 added >$3bn success case NPV (>$400mm EMV)

22nd March 2012 | Page 29

• Targeted play led exploration
• Leveraging extensive datasets and

geophysical expertise

• Pushing plays beyond their currently

understood limits – wider and deeper

• Future growth from within the portfolio

and through new acquisitions and/or licence awards

• Targeting 7-8 wells in 2012 with

combined gross mean prospective resource estimate of >350 mmboe

Exploration – North Sea Overview

22nd March 2012 | Page 30

• Premier has the regional database to pursue

amplitude supported Tertiary prospects throughout the Central North Sea

• 3 firm wells to be drilled in 2012 targeting

Eocene prospects: Carnaby, Coaster and Cyclone – Combined gross prospective resource estimate of 48-115-225 mmbo

• The Stringray prospect is attempting

to push the boundaries of the Jurassic play fairway to the North – Gross prospective resource estimate of 12-30-90 mmbo

Exploration – North Sea Pushing the plays wider

Cyclone Coaster Stingray Varadero Carnaby Catcher N & E Eocene ( Lower Tay) amplitude extraction Burgman

2km

Coaster Tay Amplitudes Catcher East Discovery Coaster Prospect

Eocene Turbidite Sand Fairway

Carnaby

22nd March 2012 | Page 31

Appraisal – North Sea Greater Fyne Area

• Fyne Area entry – seeking incremental

reserves to reach development threshold

• Erne and Fyne Appraisal encountered

hydrocarbons but limited impact on reserves for Greater Fyne Area

• Reserves insufficient for standalone

development

• Economics of tieback to nearby host

FPSOs do not currently meet Premier corporate hurdles

• Discussions with partners ongoing

East Fyne Erne

22nd March 2012 | Page 32

Cyclone (P1784) (21/7b)

• Premier 70% equity, block awarded in 2010
• Gross prospective resource estimate (on block)

– 20-35-50 mmboe (Tay reservoir)

• Risk assessment: moderate

– Critical factor: oil column

• Well planned for Q3 2012

Exploration – North Sea Pushing the play wider ... Cyclone

Amplitude extraction Green - oil? Yellow - gas Cyclone amplitude response

• n far stack data

Balder 2km Cyclone

Cyclone

22nd March 2012 | Page 33

Norfolk (P1887) (12/16b & 12/17b)

• Premier 25% equity, block awarded in 26th Round
• Gross prospective resource estimate (on licence)

– 20-146-495 mmboe

• Risk assessment: high

– Critical factor: hydrocarbon charge and quality

• Prospect maturation ongoing

Exploration – North Sea Pushing the plays wider ... 2013

Norfolk

Norfolk Norfolk

NNW SSE E W

22nd March 2012 | Page 34

• Potential exists for deeper

underexplored fairways in the North Sea

• In 2012, Premier will drill two prospects

targeting this deeper potential: Lacewing (Triassic target) and Luno II (Jurassic target)

• Combined gross prospective resource

potential of 100-200-400+ mmbo

• Additional prospect maturation ongoing

for drilling in 2013 and beyond

Exploration – North Sea Pushing the plays deeper

Lacewing Luno II

22nd March 2012 | Page 35

Exploration – North Sea Pushing the plays deeper ... Luno II

Luno II (PL 359)

• Premier equity 30%
• Greater Luno is a regional high

– Focus for oil migration – Regional top seal drapes the high – Jurassic/Triassic reservoirs flank the high and, where fractured, basement is also a reservoir – ~2,000 mmboe discovered to date

• Key play risks

– Reservoir presence on the margins of the high – Lateral seal

Johan Sverdrup

PL 359

BCU Time Map

C.I. 100 ms

Luno/Apollo Ragnarrock

10km

Luno II Prospect

• Luno II is on the Southwest margin of the Johan Sverdrup high
• Mesozoic sand presence interpreted from seismic and local well data
• Gross prospective resource estimate: 125mmbo (mean)
• Risk assessment: moderate

– Critical factor: lateral seal

• Well planned for Q4 2012

22nd March 2012 | Page 36

Lacewing (P1181, 23/21 & 23/22b)

• Gross prospective resource estimate

(on block) – 50-70-90 mmboe

• Risk assessment: high

– Critical factor: trap effectiveness and reservoir quality

• Transfer of 37.3% and operatorship to

ConocoPhillips plus partial carry – Premier’s retained equity in the block will be 20.2%

• ConocoPhillips considerable HPHT

experience

• Well planned for Q4 2012

Top Triassic Depth Map

Exploration – North Sea Pushing the plays deeper ... Lacewing

22nd March 2012 | Page 37

• Play led approach in the Nam Con

Son Basin – North West Chim Sáo Appraisal – Kuda/Singa Laut wells planned – Prospect maturation for 2013

• Adding gas reserves

– Anoa Deep success – Biawak Besar planned for late March – Matang will spud Q3 2012

• Pushing the frontiers

– Benteng expected to spud late March

Exploration – Asia Overview

Benteng Chim Sáo Anoa Deep, Biawak Besar Matang Kuda/Singa Laut

22nd March 2012 | Page 38

Exploration – Asia Kuda/Singa Laut ... 1H 2013

Fluid Detection Volume – 3D Inversion 4 km Combined Depth Structure Map

• 3200m

Kuda/Singa Laut (Tuna Block)

• Premier 65% equity and Operator
• Faulted dip closed structure up dip from a proven source

kitchen to the east – Primary reservoir target is Miocene in the Kuda Laut segment and Oligocene in the Singa Laut segment

• Risk assessment: low (amplitude supported)
• Gross prospective resource estimate: 60-100-140 mmbo
• Well planned for 1H 2013

Kuda Segment Singa Segment Singa Laut

Kuda Laut Singa Laut

22nd March 2012 | Page 39

Anoa Deep (Natuna Sea Block A)

• Premier 28.67% equity and Operator
• Drilled as an exploration tail to the WL-5 development well
• Encountered ~300 feet of fractured Lama Sandstones
• Lama formation tested and flowed gas

– 17 mmscf/d through a 48/64 inch choke – Estimated total gas in place of 70-100-150 bcf

• The well will be tied-in to the Anoa facility
• Significant follow-on potential

– Similar sized structures are mapped at the Top Lama to the north and east of Anoa Deep

Exploration – Asia Anoa Deep success

Top Lama Depth C.I.=100 feet WL 1 Km

Anoa Deep Discovery Anoa North

2 Km

PRIMARY TARGET NW SE

Anoa Deep (WL-5X)

PTD 10850 ft MD (9550 ft TVDss) Top Lama

22nd March 2012 | Page 40

Benteng (Buton Block)

• Premier 30% equity, operated by Japex
• Gross prospective resource estimate:

– 77 mmboe (mean)

• Risk assessment: high

– Critical factor: trap presence

• Well planned for late March

Buton Block Bulu-1

Benteng-1

PTD 3200m MD

PTD

2 Km 2 Km

PRIMARY TARGET NW SE

Exploration – Asia Potential play opener ... Benteng

22nd March 2012 | Page 41

L10A & L10B

• Potential to extend successful plays to

the south into Kenya

• 2535 km2 of 3D seismic successfully

acquired in Q4 2011 – Processing of 3D seismic to be completed by year-end

• 1030 km of 2D successfully acquired in

Q1 2012 – Processing to be completed in Q2 2012

• Preliminary data sets show good quality

Exploration – MEAP Entry into offshore Kenya

Test line from the 3D survey

22nd March 2012 | Page 42

Exploration drilling 2012

17 exploration and appraisal wells planned for the remainder of 2012, targeting ~200 mmboe

• f net unrisked prospective resource

Contingent Wells Firm Wells: Rig Contracted Firm Wells: Rig TBC All well timings are subject to revision for operational reasons

Q1 Q2 Q3 Q4

Vietnam Block 12W Chim Sáo NW Appraisal 17 Low Indonesia Buton Benteng-1 77 High Natuna Sea Block A Biawak Besar 15 Low Block A Aceh Matang 40 Low Norway PL359 Luno II 125 Moderate UK P1430 Carnaby 34 Low P1812 Coaster 50 High P1430 Bonneville TBC Low P1212/P1771 Stingray 32 Moderate P1784 Cyclone 35 Moderate P1655 Spaniards 32 High P1181 Lacewing 70 High Pakistan Kadanwari K-32 7 Low Bhit-Badhra Badhra South Deepening-1 38 High Badhra-7 10 High Mauritania Commitment well TBC TBC

Middle East - Africa - Pakistan Asia 2012 Mean gross unrisked resource (mmboe) Risk North Sea

PRA 01 Weatherford 812 Bredford Dolphin Sedco 711 Sedco 711 Glomar Arctic III Wilphoenix Maersk Resiliant Wilphoenix West Callisto ENSCO 107 Sedco 711

Wells to watch in 2012

22nd March 2012 | Page 43

2012 New Venture focus

North Sea (Rift theme)

• UK and Norway Licence Rounds
• Potential adds through acquisition

MEAP (Rift & Frontal Fold Belt themes)

• East Mediterranean and Egypt
• Pakistan and Iraq
• Expanding Premier’s acreage position in

East Africa Asia (Rift & Frontal Fold Belt themes)

• Andaman Sea
• East Vietnam
• Frontier Basins of East Indonesia

22nd March 2012 | Page 44

Exploration

Key messages...

• Portfolio of >1.5 billion boe of unrisked potential
• Wells to watch

– North Sea: Carnaby, Coaster, Cyclone and Luno II – Asia: Anoa Deep, Biawak Besar and Chim Sáo North West appraisal

• On track to deliver material programme in 2013 and beyond
• New Venture focus on basins with geologies that we understand

22nd March 2012 | Page 45

Summary

22nd March 2012 | Page 46

Already in 2012...

• Solan
• Anoa Deep
• EnCore Oil
• Finance

– – – – Board approval A new exploration play beneath Anoa Completed acquisition and Cladhan sale Cash/undrawn facilities increased to $1.4 bn Forward plan...

• Production
• Developments
• Exploration
• Acquisitions
• Cash flow

– – – – – Rising production to 100,000 boepd Delivery on time, on budget, operated Enhancing portfolio materiality Where we can add value Increasing to $2 bn per annum

What can you expect from Premier?

22nd March 2012 | Page 47

Appendix

22nd March 2012 | Page 48

Group taxation position

Overseas Prior period provisions UK PRT CT Prior period revisions Current charge Deferred tax credits Tax credit for the year 12 months to 31 Dec 2010 $m 56.9 25.9 Nil (21.3) 61.4 (90.4) (29.0) Allowances brought forward Net additions in 2011 excluding RFES RFES changes Tax allowances carried forward* UK Tax Allowance Position at 31 Dec 2011 $m 1,112 204 44 1,360 12 months to 31 Dec 2011 $m 60.1 72.1 17.2 nil (2.1) 147.3 (177.0) (29.7)

* fully recognised as deferred tax asset

22nd March 2012 | Page 49

Other developments

• Caledonia will be a tieback to Balmoral

but with gas lift from Britannia

• Sanction in 2012 with first oil in 2014
• New “Small Field Allowance” expected

Block A Aceh (Vietnam)

• Project sanction delayed

– Facilities sharing agreement with Arun not completed (Arun owner is selling the asset) – EPCI bid: decision taken to re-tender

• First gas is now scheduled for mid-2015

Caledonia (UK)

22nd March 2012 | Page 50

Other developments

Bream (Norway) Frøy (Norway)

• Work on the stand-alone development

remains on hold

• Discussions on joint development are

underway with other operators

• Focus is Frigg Gamma Delta where a

new operator has recently taken over

• First oil for Froy modelled for 2017
• Development plan progressing and the

FPSO has been selected

• FEED is underway on both the FPSO

and the subsea scope

• FPSO contract expected soon
• Project sanction is planned for Q3 2012,

with first oil in 2015

22nd March 2012 | Page 51

End 2011 2P reserves and contingent resources

North Sea Asia MEAP Total 2P Reserves On production 36.8 74.8 32.5 144.1 Approved for development 16.6 33.7 5.1 55.5 Justified for development 71.8 24.1 0.8 96.7 Total Reserves 125.2 132.6 38.5 296.3 2C Contingent Resources Development pending 52.9 7.4 1.0 61.3 Un-clarified or

• n hold

16.1 32.9 15.7 64.6 Development not currently viable 27.6 63.9 12.8 104.4 Total Contingent Resources 96.6 104.2 29.5 230.3 Total Reserves & Contingent Resources 221.8 236.8 68.0 526.6 These figures do not include prospective resources

22nd March 2012 | Page 52 Unrisked Resource Portfolio Risked Resource Portfolio

Discovered resource under appraisal 33 mmboe Leads 196 mmboe Prospects 160 mmboe Total 1,729 mmboe Total 373 mmboe

• Unrisked prospective resource portfolio
• f 1,696 mmboe
• Portfolio changes from 2010:

– Increased lead inventory in Kenya, Norway and the UK – Prospect inventory adjusted post 2011 drilling

• Risked prospective resource portfolio of

356 mmboe – 160 mmboe in prospects – 196 mmboe in leads – Focus to lead and prospect maturation in 2012

Prospective resource portfolio

Discovered resource under appraisal 17 mmboe Leads 1,186 mmboe Prospects 510 mmboe

22nd March 2012 | Page 53

UK P077: East Fyne

Stingray

Norway PL374S: Blabaer

Bonneville Carnaby

Vietnam Block 12W: CS NW

Appraise Drill Evaluate

Acquire Licence Gate Drill Decision Gate Appraisal Approval Gate Project Extension Gate

MEAP North Sea Asia

Pre- Development

Spaniards Coaster Cougar Rapide Rocket K-32 Badhra South Badhra-7 New York Typhoon Lacewing Cyclone Tupai Anakonda B Sedang Kakak Tua B Kecil Sambar CRT Silver Sillago Singa / Kuda Laut Peudawa Rayeu Alur Kacang Biawak Besar Matang Benteng Baroosh Badhra-6 Parh Norfolk Moth E. Moth S. Cornet Dino Luno II

Recent acquisitions add to overall portfolio volume

LEADS PROSPECTS MATURE PROSPECTS UNDER APPRAISAL

<10 10-25 26-49 50+ Net Prospect Rec Resource

(mmboe) Risked

Acreage acquired in 2011

22nd March 2012 | Page 54

Carnaby

Exploration – North Sea Carnaby

Carnaby (28/9)

• Premier 35% equity
• Gross prospective resource estimate

– 15-30-50 mmbo (Tay reservoir)

• Expected phase oil

– Gas in shallower Eocene targets (Upper Tay)

• New 3D seismic data work ongoing
• Well planned for Q2 2012

Varadero Carnaby Catcher N & E

Catcher Main Catcher E Carnaby Varadero

N S

Lower Tay Upper Tay

Burgman

Cromarty Depth Structure

Carnaby Prospect

Eocene ( Lower Tay) amplitude extraction

Carnaby

Burgman

Burgman

22nd March 2012 | Page 55

Exploration – North Sea Coaster

Coaster (28/10a)

• Premier 100% equity, TAQA farmed

into 50% interest

• Gross prospective resource estimate

13-50-125 mmboe (on block)

• Eocene and Palaeocene reservoirs
• Risk assessment: high

– Critical factor: trap and charge

• Well due to spud Q2 2012

Rapide Cougar Varadero Catcher North JU1 Catcher Tiger Burgman Rocket Paso Bonneville Area Vincent Coaster JU2 Carnaby

22nd March 2012 | Page 56

Stingray (P1212) (15/13b)

• Premier 50% equity, block awarded in 2004
• Gross prospective resource estimate (on block)

– 12-30-90 mmboe

• Risk assessment: moderate

– Critical factor: trap – sealing fault to the north cannot be accurately determined

• Planned spud date Q2 2012

Exploration – North Sea Stingray

Stingray Prospect

Stingray

22nd March 2012 | Page 57

Spaniards (P1655)

• Premier equity 28% and Operator,

adjacent to Scott infrastructure

• Gross prospective resource estimate:

– 10-30-40 mmbo

• Risk assessment: high

– Critical factor: reservoir development

• Primary Target:

– Jurassic Galley Sands (oil) – Appraising down dip extent of crestal

• il discoveries in wells 15/21a-38z

and 15/21-2

• Well planned for Q3 2012

Top Galley Sand Depth

14/25a-5

Perth Halibut Horst

Spaniards West Ryazanian Spaniards East Galley Spaniards Central Galley

Exploration – North Sea Spaniards

22nd March 2012 | Page 58

Biawak Besar (Natuna Sea Block A)

• Premier: 28.67% equity and Operator
• Gross prospective resource estimate 13-15-17 mmboe
• Risk assessment: low

– Critical factor: lateral seal presence

• Potential in a stratigraphic trap down-dip of the Iguana-1

discovery

• Well planned for Q2 2012

Top Arang Depth C.I.=100 metres

2000m Iguana Discovery Biawak Besar-1

Biawak Besar

PTD 5950 ft MD

Top Lama PTD

500m

SE NW

PRIMARY TARGET

Biawak Besar

Exploration – Asia Biawak Besar

22nd March 2012 | Page 59

Matang (Block A Aceh)

• Premier equity 41.67%
• Gross prospective resource estimate 20-40-70 mmboe

(whole structure)

• Risk assessment: low

– Critical factor: reservoir presence – 250 BCF follow on potential in the success case

• Well planned for Q3 2012

500m

E W

Top Belumai

Matang-1

PTD 3000m MD Matang

Top N4 Belumai Carbonate C.I.=50 metres

1 Km Matang-1

Exploration – Asia Matang

22nd March 2012 | Page 60

www.premier-oil.com March 2012