LUKOIL International Services B.V.
LUKOIL International Services B.V.

History

LUKOIL International Services B.V. was established in 2016 as a result of restructuring the system of international projects management in the Upstream segment of the LUKOIL Group. 

The year of 1994 marked the start of the Company’s international expansion, when a 10% stake was acquired in the development of Azerbaijan's largest field in the Caspian Sea — Azeri-Chirag-Guneshli. Over 1995—1997, LUKOIL continued its international expansion, joining other oil and gas projects such as Karachaganak, Kumkol and Tengiz (Kazakhstan), Meleiha (Egypt), Shah-Deniz (Azerbaijan).

For the purpose of consolidation of the Company’s upstream projects outside the territory of Russia, LUKOIL Overseas (100% subsidiary of PJSC LUKOIL) was established on 4 December 1997. From 1997 till 2015, LUKOIL Overseas acted as the sole operator of all LUKOIL’s international upstream projects. The activity of LUKOIL Overseas led to creating large international production centers for the Company, in particular, in the Middle East (West Qurna-2 project in Iraq). 

By 2012—2013, LUKOIL Overseas was implementing around 30 exploration and production projects in 13 countries worldwide. Apart from the Middle East, the Company was active in such regions as Europe, Asia, Western Africa, and Latin America. In 2014, the share of LUKOIL Overseas in LUKOIL's total oil production reached 10%, while its share in total hydrocarbon production — 13.3%. The Company provided around 25—30% of the LUKOIL Group’s total gas production.

In 2016, a regional model of management of the Company’s international assets in the Upstream segment was implemented. Three large operating hubs were created: in Dubai (Region 1), Houston (Region 2) and Tashkent (Region 3). The hub in Dubai (LUKOIL International Services B.V.) manages oil and gas projects in the Middle East (Iraq, Iran, Egypt, Saudi Arabia).

In 1995, the Company entered the Meleiha project in Egypt (Western Desert) with a contract validity period till 2024. Meleiha is one of LUKOIL’s first overseas production assets. 

On 4 December 1997, the Board of Directors of PJSC LUKOIL adopted a resolution to establish LUKOIL Overseas.

In 2001, LUKOIL Overseas acquired assets of Bitech Petroleum (Canada), as a result, entering the project to develop the West Esh El-Mallaha oil field (WEEM) in Egypt.

In 2002, a representative office of LUKOIL Overseas in Cairo (Egypt) was opened. 

A contract was signed with Norsk Hydro (Norway) for joint exploration of the Anaran prospect in western Iran.

In 2004, as a result of a public tender, LUKOIL Overseas gained the right to explore and develop gas and gas condensate fields in Block A located in the northern part of the Rub Al-Khali desert in the Kingdom of Saudi Arabia. New offices of LUKOIL Overseas were opened in Dubai (UAE) and Tehran (Iran) in the same year.

In 2005, exploration drilling resulted in discovering a large oil field, Azar, on the Anaran block in Iran.

In 2006, LUKOIL Overseas began deep exploration drilling on the contract area of Block A in Rub Al-Khali (Kingdom of Saudi Arabia).

In 2007, new oil fields were discovered in the Northern Nada and Gawaher structures of the Meleiha block in Egypt. LUKSAR, a joint venture of Saudi Aramco and LUKOIL Overseas, discovered an accumulation of hydrocarbons in the Tukhman prospect of the Block А contract area in the Kingdom of Saudi Arabia.

In 2008, LUKSAR, a joint venture of LUKOIL Overseas and Saudi Aramco, discovered an accumulation of hydrocarbons in the Mushaib structure in the central part of Block A located in the Rub Al-Khali desert in the Eastern Province of the Kingdom of Saudi Arabia.

After drilling 9 exploration wells and carrying out 2D seismic acquisition of 20 599.5 linear km, LUKOIL Overseas completed the minimum exploration program on Block A in the Rub Al-Khali desert in the Eastern Province of Saudi Arabia and proceeded to the next phase, which covered drilling of 5 appraisal wells and additional 3D seismic acquisition. At the same time, 90% of the initial area of Block A was returned to the state fund outside two appraisal areas: Tukhman and Mushaib.

In 2010, a Development and Production Service Contract was signed for the West Qurna-2 field in Basra (Iraq).

In the same year, pilot production started on the WEEM Extension block in the Eastern Desert (Egypt), and an oil field was discovered on the Arcadia prospect within the Meleiha block in the Western Desert (Egypt). 

In 2011, Pilot Camp, the first facility of the West Qurna-2 field, was opened during a working visit of Vagit Alekperov, President of PJSC LUKOIL, to Iraq.

Several major contracts were signed for the West Qurna-2 field development (Basra, Iraq). The active development phase started with production drilling and construction of a key production unit - oil processing facility.

During follow-up exploration of the contract area of the Meleiha block (Western Desert, Egypt), a high-quality light oil field was discovered on the Emry Deep prospect.

An amendment to the Development and Production Service Contract for the West Qurna-2 field in Iraq was signed, reducing the project's production target from 1.8 million to 1.2 million barrels of oil per day, extending the production plateau from 13 to 19.5 years and prolonging the total contract period from 20 to 25 years. 

A consortium including LUKOIL Overseas discovered a high-quality light oil field on the Rosa North prospect during additional exploration of the Meleiha concession area in Egypt's Western Desert.

Commercial production started at the West Qurna-2 field in Iraq. Initial production amounted to 120,000 barrels of oil per day. 

The first tanker loaded with compensation oil for recovery of LUKOIL's costs under the West Qurna-2 project departed from Basra in the south of Iraq.

A consortium including LUKOIL Overseas discovered a high-quality light oil field on the Meleiha-West prospect during additional exploration of the Meleiha concession area in Egypt’s Western Desert.

In 2015, LUKOIL Overseas completed the 2D seismic survey at Block 10 in southern Iraq four months ahead of schedule.

Construction of the first exploration well Eridu-1 in Block 10 in southern Iraq was started.

A regional model of management of the Company’s international assets in the Upstream segment was implemented by establishing three large operating hubs: in Dubai (Region 1), Houston (Region 2) and Tashkent (Region 3). The hub in Dubai (LUKOIL International Services B.V.) manages oil and gas projects in the Middle East (Iraq, Iran, Egypt, Saudi Arabia).