LUKOIL Group has proved hydrocarbon reserves in six countries. The majority of the proved reserves is conventional, providing the Company a significant competitive advantage that ensures lower development and production costs per barrel.
As of the end of 2017, the Company’s reserves life was 19 years in comparison with the average of 12 years among the world’s largest international oil companies. LUKOIL is one of the leading international and Russian companies in terms of proved reserves life and quality.
fields and high-viscosity oil account for approximately 11% of the proved
reserves. About half of LUKOIL’s international proved reserves is in
Uzbekistan, where the Company actively develops its gas projects.
60% of the Company’s proved hydrocarbon reserves have been classified as
developed, in that they can be extracted from the existing wells using
currently available technology and equipment.
13.7 billion boe in contingent resources provide the potential for increasing
its proved reserves as the macroeconomic environment improves, development
plans evolve, costs are optimized, new technologies are introduced, and pilot
works are carried out.
Pursuant to the Russian legislation, hydrocarbon exploration and production operations are carried out under subsoil use licenses. LUKOIL continuously works to obtain subsoil rights, monitors potential subsoil use plots, applies for new licenses and extends the existing ones.
of the end of 2017, the Group held 523 licenses in Russia, with 90% of them
granting either ‘hydrocarbon exploration and production’ or ‘hydrocarbon
prospecting, exploration and production’ rights. The average remaining validity
period of these licenses is 29 years. Some of LUKOIL’s licenses are unique,
such as the subsoil license for the Imilorskoye field in West Siberia, which
indicates federal significance of the field and is valid until 2127. The
remaining 10% of the Company’s licenses grant the right to “prospect, explore,
and appraise hydrocarbon deposits”, with an average remaining validity period
of about 3 years.