LUKoil to Develop Gas In North Perm Region

LUKOIL?s Scientific and Technical Council, chaired by the President of the Company, Vagit Alekperov, approved inclusion of the establishment of a system to gather, treat, transport and utilize the associated petroleum gas produced in the northern part of Perm Region by LUKOIL-Perm, which operates the Russian projects of LUKOIL Overseas, in the Company?s investment program.
The new system will connect three large fields in the Karsnovishersky and Solikamsky districts, which produce oil with at high gas-oil ratios: the Ozernoye, Magovskoye and Logovskoye fields. At the moment all produced gas is being flared. In the future the gas will be fully utilized, providing environmental improvements in addition to economic benefits.
To be able to utilize the associated petroleum gas, in 2005 LUKOIL-Perm will start constructing an inter-field gas grid, to be made up of 180 kilometers of pipelines of various diameters. It will be connected to the trunk pipeline at the Unva terminal in Usolsky district of Perm Region. From there the gas will be taken to LUKOIL-owned gas refinery Permneftegazpererabotka to be used in gas-chemical production, including export-oriented.
The system will be commissioned in 2007 and achieve target capacity of 130 million cubic meters of gas per year in 2010. The total amount of investment will exceed 900 million roubles. Beginning in 2015 the system will also start receiving 50 million cubic meters per year of gas from the gas cap of the Magovskoye field.