Premier Oil announces trading and operations update

On Jan 12, 2017

Premier today provides the following Trading and Operations Update ahead of its 2016 Full Year Results which will be announced on Thursday 9 March 2017.

2016 Highlights

Record production of 71.4 kboepd, up 24% on 2015 and in line with previously upgraded guidance
Opex per barrel of $15.7/bbl
Estimated capex of $690 million, below guidance of $730 million
Net debt of $2.8 billion as at 31 December 2016, reduced in Q4 as anticipated
Cash and undrawn facilities of around $600 million

Outlook

2017 production guidance of 75 kboepd, before any contribution from Catcher and adjusted for lower Solan profile
Catcher on schedule for start-up later this year with total capex now forecast at $1.6 billion, 29% lower than sanctioned estimate
Approval of Tolmount development concept expected shortly, will provide next phase of growth
Increased equity interest to 25% in large Zama prospect (Mexico); expected to spud early Q2
2017 capex guidance of $350 million (including abandonment spend)
Net debt will continue to reduce at current forward curve

Refinancing

All substantial commercial terms have been agreed with the Coordinating Committee of the RCF Group and representatives of the other Private Lenders; long form term sheet at advanced stage
Publication of full details of terms on circulation of the long form term sheet to lenders which is expected shortly

Tony Durrant, Chief Executive, commented:

“Premier achieved a strong operational performance in 2016, resulting in record production and the successful integration of the ex-E.ON portfolio. The Catcher project continues to progress well and will provide another step change in production, generating enhanced, tax-free cash flows for the Group. Our debt refinancing is nearing completion which, together with the improving commodity price environment, will enable us both to accelerate debt reduction and to progress future growth projects.”