Premier Oil to acquire 40% interest in PL407 license off Norway

Premier Oil to acquire 40% interest in PL407 license off Norway

BY RORY GALLIVAN

LONDON -- Premier Oil said that it has agreed to acquire a 40% interest in the PL407 production license on the Norwegian Continental Shelf from BG Norge.

Purchase is in conjunction with KUFPEC Norway AS, which will acquire a 30% interest while Premier will increase its existing 40% equity interest to 50% and assume operatorship of PL407 and the Bream project. The aggregate consideration payable by Premier and KUFPEC will be $22.2 million prior to interim period adjustments.

Under a separate agreement, KUFPEC will acquire a 30% interest in the adjacent PL406 license, which contains the Mackerel discovery and the Herring exploration prospect, from Premier for a contingent consideration of $5 million.

The acquisitions are subject to Norwegian government approval; development sanction for the area is targeted for 2014. Premier currently estimates 2C resources covering the Bream and Mackerel accumulations of around 50 MMboe.

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