Located in the Dorset County, the Wytch Farm which is operated by Perenco UK has been in production since 1979.

While Perenco holds a majority stake of 53.8%, Ithaca Energy holds 7.4% and Repsol Sinopec has a stake of 5% in the Wytch Farm oil field contained in licenses PL089 and P534.

Premier says that the transaction is in line with its track record of value realization of assets at the appropriate stage of their life-cycles by using active portfolio management.

Its board has concluded that the sale of the Wytch Farm stake is in the best long-term interest of the company and its stakeholders.

Premier Oil CEO Tony Durrant said: “The Disposal will allow for a significant reduction in Premier's net debt and generates material value for shareholders. This is the latest in a series of disposals in line with Premier's strategy of realising value for shareholders at the appropriate stage of an asset's life cycle and at an attractive valuation.”

Premier stated that its lenders have given the required approvals and consents in connection with the transaction.

The company said that the transaction process will begin imminently, subject to the pre-emption rights of its partners in the Wytch Farm.

According to Premier, the Scotland-based Verus Petroleum will take over all of the abandonment liabilities and related decommissioning security. As a result, Premier says that it will be relieved from letters of credit, totaling to nearly $75m, held currently for field abandonment liabilities in the future.

Backed by Norwegian private equity investor HitecVision, Verus is an independent UK-focused exploration and production company.