Premier Oil on target

Premier Oil has reported that its two significant Asian developments are now onstream as a result of progress made during the period to 15 November.

The firm's Chim So site is producing 25-30 thousand barrels of oil per day (kbopd), ahead of expectations.

Meanwhile, the Gajah Baru area is now expected to average 60bn British thermal unit per day (bbtud) for the remainder of the year.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

The year's production guidance of 40-45 thousands of barrels of oil equivalent per year (kboepd) remains unchanged, the firm said.

Premier continues to expect a run rate of 60 kboepd by the end of the year and to target 100 kboepd in the medium term.

The recommended acquisition of EnCore is on track to be completed in January 2012. Upon completion, Premier has agreed to the follow on-sale of EnCore's interest in Cladhan to TAQA for a cash consideration of $54.8m.

The firm has planned a programme of 25 wells for over the next 13 months with unrisked resource potential in excess of 200m barrels of oil equivalent.

Chief executive Simon Lockett said: "It is extremely pleasing to see such good early performance from our newly producing operated fields in Asia which keeps us on track to achieve rapidly growing near term cash flow.

"Having delivered successfully in Asia, the focus for investment activities now shifts back to the North Sea where we continue to build another high quality business with significant upside potential."

The share price rose 1.59% to 365.3p by 08:58.

NR