Zama Discovery Interim Update 13th July 2017

Mexico: 111 years of E&P history, 78 years under state monopoly

Sureste Veracruz

Tampico- Misantla

Campeche

Mexican Ridges

61 Bboe

Sureste

14 Bboe

2.0 Bboe

0.9

0.3

0.4

0.5

Salina del Bravo & Perdido

oil

gas

Area proportional to

discovered resource

Burgos

Burgos • Onshore, Mature • Gas, minor Oil • Main Play: Paleogene Deltaics

Tampico - Misantla • Onshore, Mature • Oil + Assoc Gas • Main Plays: Jurassic /

Cretaceous carbonates

Veracruz • Onshore, Mature • Gas, minor Oil • Main Plays: Cretaceous

carbonates; Tertiary deep water sandstones

Sureste (offshore) • Shallow to Deep-Water,

Emerging • Oil + Assoc Gas • Main Play: Cretaceous / Jurassic

carbonates; Neogene clastics • Salt plays

Mexican Ridges • Slope & Deep-Water, Frontier • Possible Gas (Tertiary SR), but

unknown • Main Play: Paleogene &

Neogene DW Clastics

Campeche • Slope & Deep-Water, Frontier • Probably Mixed Oil and Gas • Main Play: Neogene DW

Clastics • Salt plays

Perdido • Deep-Water, Emerging • Oil + Assoc Gas • Main Play: Neogene and

Paleogene clastics • Salt plays

July 2017 | P1

• Premier screening high-graded Sureste Basin as best fit for entry

• Opening of a high potential energy sector to foreign investors after 78 years of state monopoly.

• Establishment of a clean and transparent process with an independent regulatory body, CNH.

• Extensive modern datasets made available for a reasonable cost across most basins.

• CNH and SENER (Ministry) continuing to mature both the licencing process and terms.

• Bid conditions comprise government take and defined work programme.

• Mexico offers large tracts of acreage in proven basins with access via a regular tender process.

July 2017 | P2

Mexico: recent Energy Sector Reform

July 2017 | P3

• Successful entry (10% carried) into Blocks 2 & 7 in Q3 2015

• Increased equity to 25% (paying) in May 2017 in Block 7, ahead of Zama well

Block 2

Mexico: Premier Sureste Basin Licence Position

Block 7 Premier 25%

Talos (op) 35% Sierra 40%

ENSCO 8503

Flat Spot

• Talos (op.) spudded the well in 166m of water on 21 May using the Ensco 8503 rig.

• Premier’s pre-drill assessment of Zama was of it being a low risk prospect, with a P50 of 300 MM barrels EURR within a range of 100-500 MM barrel

full stack reprocessed seismic data in depth

E W Zama-1 Well

July 2017 | P4

Good conformance of seismic amplitude with structural contours

salt

salt

3D view of the Zama Prospect showing top structure map and seismic amplitudes of the target interval

Zama-1 Well

Mexico: Block 7 Zama Prospect (Premier 25%)

2km

Flat spot

Zama Main 3D view of Zama showing top structure and seismic amplitudes of the main target

Good conformance of seismic amplitude with structure

salt

salt

salt

salt

– 1 km

– 2 km

– 3 km

– 4 km

– 5 km

seismic section (left) runs E-W through well

ST drilled ahead to 13 5/8” casing point.

Well was side-tracked to west and contingency 16” liner set above fault.

Current hole depth 3381 m MD

•80-90 days (mid Aug) to drill and evaluate the well to TD of 4400 mTVD (no well test planned).

•Forecast cost $61.5m gross, $15.4m net to Premier’s 25%.

•Forward Plan: Case current hole section then drill ahead and evaluate the remainder of Zama Main and Zama Deep secondary target.

Mexico - Zama-1

July 2017 | P5

PTD 4426 m MD

E W Zama-1 Well

Zama Deep

Global significance of the Zama Discovery

July 2017 | P6

0

100

200

300

400

500

600

700

800

900

1000

Liza-Payara IaraEntorno

Tulimaniq Carcara Owowo Anchor NorthPlatte

SNE Orca Itapu Itapu(Surplus)

Snoek Bay duNord

1500

2000

Zama pre-drill volume range

Sits in top 10 largest offshore commercial oil discoveries of the last 5 years

(Data courtesy of WoodMac) Offshore Oil Discoveries >300 mmboe since 2012

Res

erve

s (m

mb

oe)

July 2017 | P7

Mexican fabrication capability

• Development conceptual engineering will commence shortly.

• Given the scale of the Zama discovery an illustrative fixed installation development could be much as shown here:

– Single jacket and significant topsides, with capabilities of producing well in excess of 100,000 bopd

– Single drill centre with wells drilled from the platform

– A pipeline to the Dos Bocas terminal

• The development could leverage the significant Mexican country infrastructure and manufacturing plants.

• In terms of timetable we would expect to appraise in 2018 and to target first oil well within 5 years.

Zama – Illustrative Development Scenario

Illustrative development schematic

Mexico - Block 7 - Fiscal Terms

July 2017 | P8

Gro

ss R

eve

nu

es

Co

st R

eco

very

P

rofi

t O

il

Exploration

Capex

Opex

Contractor Profit Oil

Government Profit Oil (68.99%)

Royalties

Contractor Gross Revenues

60% limit of Gross

Revenue (per month)

Corporation Tax 30%

Representative barrel of oil at $65/bbl

Royalty Sensitivity to Oil Price

Oil Price $/bbl

Roy

alt

y

100

%

125%

Exploration benefits from a

25% uplift

Premier Oil Plc 23 Lower Belgrave Street London SW1W 0NR Tel: +44 (0)20 7730 1111 Fax: +44 (0)20 7730 4696 Email: premier@premier-oil.com

www.premier-oil.com

July 2017