FTSE 250 oil and gas company Premier Oil has exercised its option to drill the East Fyne appraisal well in the UK Central North Sea.Premier has a joint venture and earn-in agreement relating to the area of the North Sea containing the East Fyne well with oil and gas firm Antrim Energy. Under the terms of the agreement Premier will have a 39.9% operated interest in Block 21/28a, which contains the Fyne field, in return for stumping up to $50m towards the development costs, including the East Fyne appraisal well. Antrim retains 35.1% interest in the block and a 100% working interest in the adjacent Blocks 21/28b, 21/29c, 21/24b and 21/29d (Greater Fyne Area). First Oil Expro retains an interest of 25% in Block 21/28a.The agreement also provides Premier with the option to participate at a working interest of up to 50% alongside Antrim in a planned drilling programme scheduled to start as early as the second quarter of 2011 in the Greater Fyne Area.The East Fyne appraisal well is designed to de-risk the eastern extent of the Fyne Field in Block 21/28a and is expected to be drilled in the second half of 2011. Simon Lockett, chief executive officer, commented: "This agreement is an excellent example of our ability to utilise our strong financial and operating capabilities to build in our core areas."---ab