Premier Oil awarded three blocks in Brazil

Premier Oil has been awarded three blocks in Brazil's 11th Round held in Rio de Janeiro.

The blocks are located in deep water basins offshore North East Brazil in largely under-explored areas and contain prospects and leads capable of delivering between 250m barrels and one billion barrels each.

Premier was awarded a 50% operated equity stake in blocks 717 and 665 in the Ceara basin, a cretaceous rift basin with a proven oil source rock.

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It was also awarded a 35% non-operated equity stake in Block 90 in the Foz do Amazonas basin.

Premier will pay a total of $24.5m in signature bonuses and expects to invest in the region of $25m in 3D seismic data acquisition.

Well commitments include one exploration well in block 90 and two exploration wells in block 717 at an estimated total net cost to Premier of $100m. The group will fund the cost of this work programme from within its planned exploration spend.

Simon Lockett, group Chief Executive Officer, said: "We are extremely pleased with the outcome of the bidding round in Brazil which demonstrates Premier's ability to successfully compete for world class exploration opportunities and further increases the materiality of our exploration portfolio."

The share price rose 0.42% to 381.10p by 11:45 Thursday.

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