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Energy efficiency

The effective utilization of fuel and energy resources is a priority for LUKOIL Group entities, and serves to boost the overall operational efficiency of LUKOIL Group.

Our goal is to increase the energy efficiency of the production activities of LUKOIL Group entities. Target indicators for activities are established within energy conservation programs.

Increasing energy efficiency is our strategic priority. Each business segment has its operational excellence program where reducing power consumption is a key element of cost reduction. In Exploration and Production, key energy efficiency initiatives are replacement of asynchronous motors with PMSMs and improving formation pressure maintenance system performance. In Refining, Marketing and Distribution, our energy efficiency program includes heat integration of facilities that produce and consume heat, as well as furnace efficiency upgrades and maximizing efficient industrial gas use.

In the Russian entities of LUKOIL Group an energy management system, in compliance with the international standard ISO 50001:2012, has been implemented. As of December 31, 2018, Certificates of Compliance of energy management systems with the ISO 50001 standard were held by 25 entities of the Group, and covered 68.2% of workers. The Energy Conservation Program of LUKOIL Group Entities for 2018 and 2019–2020 in Russia is under way; there are now road maps for improving operational efficiency up to 2020. The Center for Developing New Business Areas was set up to coordinate projects in the sphere of innovative technologies in the electrical energy sector and to develop a new energy infrastructure. 

Based on the results of 2018 operations, all scheduled activities were completed in full, and savings targets were achieved for each type of energy.

In industrial consumption most electrical energy is used by oil and gas extraction entities, while other types of energy resources are used mainly by oil-refining and petrochemical entities. 

The development of in-house (supporting) energy generation is performed directly at the deposits of the Group and meets the needs of production in electric and thermal energy due to APG efficient use. The further development of securing generation (as part of work to build a gas-turbine thermal power plant in Perm Territory) and the commissioning of eight steam generation plants in the Republic of Komi has been scheduled.