Premier Oil farms out interest in Sparrow prospect

BG Group and Oilexco Inc., Calgary, have joined Premier Oil PLC as partners on the Sparrow prospect on Block 23/22b, which holds the Sparrow prospect in the UK North Sea.

March 6, 2008

Uchenna Izundu
International Editor

LONDON, Mar. 6 -- BG Group and Oilexco Inc., Calgary, have joined Premier Oil PLC as partners on the Sparrow prospect on Block 23/22b, which holds the Sparrow prospect in the UK North Sea.

The Palaeocene Sparrow prospect, estimated to hold 25-40 million bbl of oil, is on trend with the recent Columbus discovery along with a deeper Jurassic prospect.

Oilexco will drill a well on the Jurassic prospect in adjacent Block 23/21, which will be sidetracked to test the Sparrow prospect. Premier will be carried for the costs of the well and will retain a 25% interest.

Oilexco will operate Sparrow with a 65% stake and will work with Reach Exploration 10%. BG Group holds a 32.5% interest in the rest of Block 23/22b. Its partners are Oilexco 32.5%, Reach Exploration 10%, and Premier 25%.

Contact Uchenna Izundu at [email protected].