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LUKOIL is leader of the Russian oil and gas industry in terms of efficient application of new production technologies. The Company invests into innovation development by implementing cutting-edge designs and technologies into every area of its operations.

Being one of the world’s largest users of natural resources, LUKOIL stringently abides by the highest global environmental standards and prides itself on the environmental management system it has in place.

Investments into future opportunities, including into innovations to gradually reduce the consumption of natural resources, materials and energy while maintaining the maximum possible output are considered by LUKOIL as its strategic priority. The Company is committed to seeking and utilizing new technologies that it believes to be one of the key preconditions not only for its own development, but also for the development of the entire country.

The following are the factors contributing to the Company’s success in finding solutions to those goals:

  • availability of well developed R&D infrastructure;

  • prospecting operational planning;

  • implementation of innovation projects;

  • international partnerships.

Due to the adopted scientific and technical development program the effort is now under way to create new technologies for the development of viscous oil and with low permeability collectors and mature fields. The Group’s refineries and processing facilities are focused on the achievement of a better refining depth with higher light products yield and facility upgrades.

The Company constantly tests new high-performance technologies to achieve its strategic goal of compensating production with the increment in reserves. To improve performance of the production operations by cutting the costs and increasing productivity, the Company is running a program of pilot projects.

LUKOIL’s key priority in production is to increase the oil recovery ratio, which, in the long term, will help capture a significant potential of the available resource base. The Company develops and utilizes high-viscosity oil production techniques. One of the priority focus areas is represented by performance improvement of development operations and implementing new technologies in order to launch production of hard-to-recover reserves in a cost-efficient manner, utilization of innovation technologies at mature blocks.

Currently, the Russian Government offers incentives for production of high-viscosity oil making it more profitable by granting investment incentives applicable to the royalty and export duty. The vastest experience in development of high-viscosity oil reserves has been accumulated in the Komi Republic where the Group develops Yaregskoye and Usinskoye fields.

Usinskoye field’s Permian-Carboniferous deposit is developed using areal steam and cyclic steam formation treatment technologies. 

Yaregskoye field consists of Yaregskaya, Lyaelskaya, and Vezhavozhskaya areas. Oil is produced at Yaregskaya (thermoshaft production) and Lyayelskaya (steam assisted gravity drainage  SAGD) areas.

Enhanced oil recovery techniques make it possible to significantly increase recoverable reserves through commercial production of high-viscosity oil reserves, as well as reserves in low-permeability reservoirs and hard-to-recover reserves of a mature field. LUKOIL utilizes physical, chemical, hydrodynamic and thermal reservoir treatment techniques. One of the high-performance oil recovery enhancement techniques is to drill sidetracks in the existing wells. High performance of sidetracking operations is first of all conditioned by the preparation of scientifically substantiated mini-projects that involve the use of hydrodynamic modeling and higher-precision forecasting of the geology and composition of reserves within sidetracking zones. Please note that sidetracking is generally used with the idle well stock in order to recover additional residual oil reserves.

Small-diameter wells speed up construction, enabling more oil reserves to be brought on stream. The average savings are 30-50% of standard well costs. Another advantage of small-diameter wells is the reduced well pad costs. The technology has huge potential, and we plan to considerably increase the number of small diameter wells in the next few years.

We have been successfully applying three-string horizontal well construction technology in West Siberia, which has accelerated construction by 35% on average (or by 50% in some cases) and reduced costs by approximately 20% as compared to the standard four-string design of horizontal wells. The number of such wells is planned to be substantially increased in the medium term.

* Including carry-overs

* Including carry-overs

Texas Two Step enables to perform multizone hydraulic fracturing in a predefined sequence rather than gradually from the horizontal well bottom, which improves performance due to higher flow rates. LUKOIL became Russia’s first company to use this fracking technology in a sidetrack. Flow rates of horizontal wells with TTS multizone fracking are 4 times as high as those of the directional wells with regular fracking, and twice as high as those of horizontal wells with standard multizone fracking.

Prospecting activities in Perm Krai (Cis-Ural region) are complicated by numerous natural protection and water protection zones within the areas of occurrence of potassium and magnesium salts. Therefore, in order to reduce environmental impact, the Group introduced environmentally friendly seismic prospecting and drilling technologies. Environmentally friendly seismic prospecting is done with the use of small-size equipment towed by snowmobiles or mounted on a tool carrier. This helps reduce deforestation activities and preserve primeval soil, while ground water experiences almost no impact. In addition, environmentally friendly seismic prospecting makes it possible to operate within the areas located in difficult geological environments with minimum deviation from the planning scope of work.

The LUKOIL Group has developed the world’s first ever drives based on AC electronic motors that ensure a range of performance parameters enabling optimal process conditions to withdraw the well stream with minimum energy inputs and maximum service life. AC electronic motors help reduce energy inputs during oil production due to higher efficiency factors and lower operating currents, as well as due to the possibility to control the rotation speed and to operate in a cyclic mode.

In the long-term perspective induction motors will be replaced with AC electronic ones in all the wells.

The Group’s research institute has developed an unrivaled waste treatment technology for the waste generated by refineries when producing a high-octane gasoline component. The technology makes it possible to produce calcium fluoride from this waste, which can be used in the metal industry and which can completely replace the imported fluorspar, the natural equivalent of calcium fluoride, that is in high demand on the market.