Premier Energy Intends to Resume Devt Drilling in Russia

Premier Energy signed a non-binding Letter of Intent with Rossgaz LLC to purchase the remaining interest in Karbon CJSC, a closed joint stock company incorporated in the Russian Federation. Concurrently, a series of meetings have been successfully completed regarding the proposed funding of the planned development drilling program for the North-Kopanskoye oil field in 2009.

Karbon CJSC is preparing to resume the planned development drilling subject to (i) successful completion of drilling agreements, (ii) release of the needed funds and (iii) Premier's board approval.

The above transactions including the acquisition of the remaining interest in Karbon, CJSC and the commencement of drilling are subject to the (i) drafting and negotiation of final definitive agreements, (ii) performing due diligence as well as (iii) board approval of Premier and Rossgaz and (iv) shareholder approval of Rossgaz. Further, Premier is required to raise the needed capital for the purchase of remaining interest in Karbon, CJSC as well as to support working capital. There is no guarantee that such financing will be available at all or, if available, that the terms will be acceptable. As such, there is no guarantee that Premier will be able to successfully close the above transaction or commence drilling.