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 2018, 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.
Concentrated mainly in West Siberia, 90% of the Group's proved hydrocarbon reserves are located in Russia. Offshore fields and high-viscosity oil account for approximately 14% of the proved reserves. Half of LUKOIL's international proved reserves are in Uzbekistan, where the Company actively develops its gas projects.
61% of the Company's proved hydrocarbon reserves have been classified as developed, in that they can be extracted from existing wells using currently available technologies and equipment.
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.
At the end of 2018, the Group held 528 licenses in Russia, with 91% of them granting either hydrocarbon exploration and production rights or hydrocarbon prospecting, exploration, and production rights. The average remaining validity of these licenses is 30 years. Some of the licenses are entirely unique in terms of use. For example, the license for the Imilorskoye field in West Siberia is of federal significance (primary importance for the national economy) and is valid until 2127, and the license for the Pyakyakhinskoye field in the Bolshekhetskaya Depression is valid until 2170. The remaining 9% of the Company's licenses grant the right to prospect, explore, and appraise hydrocarbon deposits, with an average remaining validity of about three years.
