New Licence Agreement

RNS Number:1828T
Premier Oil PLC
12 December 2003


                                PREMIER OIL PLC

                                  ("Premier")


    Premier Farms Out Licences and Applies for New Licences in Guinea Bissau

Premier is pleased to announce that it has reached agreement with Occidental
Petroleum Corporation (NYSE: OXY) to farm out 40% of its 100% paying interest in
Blocks 2, 4A and 5A (the Sinapa and Esperanca blocks) offshore Guinea Bissau in
West Africa. Premier will retain operatorship. A drilling rig has been
contracted to begin drilling the Sinapa-2 well in the first quarter of 2004 to
test a 250 million barrel oil prospect, one of a number of similar prospects on
the blocks.

Premier and Occidental have also jointly been granted two new licences covering
blocks 7B and 7C, also offshore Guinea Bissau, subject to Guinea Bissau
government final approval. Premier, as operator, has a 25% paying share while
Occidental has a 75% share. The partners plan to commence operations by
acquiring a 2D seismic survey in 2004.



Charles Jamieson, Chief Executive of Premier, said:


"We are very pleased to have as technically a strong partner as Occidental and
at the same time to have taken more acreage in Guinea Bissau. We are looking
forward to drilling this highly prospective area early in 2004."



                                                                12 December 2003




ENQUIRIES:

Premier Oil plc                                      Tel: [phone]
Charles Jamieson
John van der Welle


College Hill                                         Tel: [phone]
James Henderson
Phil Wilson-Brown


Background For Editors:


Premier Oil plc is a leading independent oil and gas company with producing
interests in the UK, Indonesia, and Pakistan. Exploration and appraisal is
ongoing in the UK, Indonesia, West Africa (Mauritania, Guinea Bissau and Gabon)
and South Asia (Pakistan and India).


The current partners and interests in the Guinea Bissau licenses are:


                                       Blocks 2, 4A & 5A                  Blocks 7B & 7C
                                        Sinapa/Esperanca

                                  Exploration     On Commercial    Exploration     On Commercial
                                  Phase             Discovery      Phase             Discovery
Premier Oil plc (Operator)**          60%              42%             25%             22.5%
Occidental                            40%              28%             75%             67.5%
Petroguin*                             -               30%              -               10%



*The Government of Guinea Bissau has the right to back in to 30% equity on
commercial discovery through the state oil company Petroguin on the Sinapa/
Esperanca licenses.


** Premier has granted Fusion Oil & Gas the right to receive a 5% paying
interest from Premier's interest in Block 2 (the Sinapa block) and in Blocks 4A
and 5A (the Esperanca blocks), these rights to be exercised within 60 days of
completion of the drilling of the next well on each block.




                      This information is provided by RNS
            The company news service from the London Stock Exchange
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