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24.11.2008 Results of BoD Meeting

Results of BoD Meeting  


A meeting to discuss liquid hydrocarbon reserves replenishment measures and industrial safety was held by OAO LUKOIL Board of Directors inMoscow today.
It was noted at the meeting that full compensation of liquid hydrocarbon extraction by reserves increment is one of the most important strategic objectives of the Company. It can be achieved by implementation of the current RF projects on the sites with С2 category reserves and on promising sites with С3 category resources; implementation of new projects in the Russian Federation and abroad.
In general, the Company’s raw material base has a favorable structure of hydrocarbon reserves. The prevailing share of liquid hydrocarbons in the total proved reserves, i.e., over 66%, comparatively low production of initial recoverable reserves, rather high proven reserves to hydrocarbon production ratio are its main features.
Gross increment of industrial reserves due to exploration has come to 1,435 million tons of reference fuel since 1995. 130 hydrocarbon fields have been discovered since then. The average cost of reserves increment is one of the lowest figures across the industry and came to about USD 2.8 per one ton of reference fuel for the period from 2001 to 2007, while the average efficiency of exploratory drilling within the period came to 1,200 tons of reference fuel per meter of drilling, which by far exceeds the average across the industry. In addition to that, over the recent years the efficiency of exploratory drilling came to 75-80%, while the average efficiency from 1995 to 2007 came to 64%, which considerably exceeds the industry average.
At present, LUKOIL is engaged in hydrocarbon discovery, exploration and production in 13 constituent entities of the Russian Federation, in the Caspian Sea and abroad. In Russia the Company has subsoil use rights to 413 license areas; over 25 projects aimed at hydrocarbon discovery, exploration and production are being implemented in the CIS countries and abroad.
It was also marked at the meeting of the Board of Directors that at the present moment the Company was a leader of the Russian oil and gas industry in terms of ensuring industrial and labor safety. The importance of human wellbeing, safe working conditions and environmental protection over economic results are LUKOIL’s overriding operating principles.
The industrial and labor safety management was introduced across all LUKOIL Group organizations and certified by Bureau Veritas, the International Certifying Agency, in terms of its compliance with the international standards ISO 14001, OHSAS 18001.
To meet the international best practices it is also planned to certify the existing industrial and labor safety in terms of its compliance with the requirements of the international standard ISO 17020 by 2011.