Low-water regions

The bulk of LUKOIL Group's production activities in Russia are performed in regions that do not experience a deficit of fresh water (with the exception of low-water years in regions with high population density and concentrations of economic activity). Nevertheless, the southern regions of Russia (Krasnodar Territory and the Rostov and Astrakhan regions) from time to time experience droughts and sharp weather variations, which impact total water consumption. According to data from the State Report "On the Condition and Utilization of Water Resources of the Russian Federation in 2016," the population of the southern regions is provided with adequate levels of fresh drinking water.

Among LUKOIL Group entities, the main consumers of fresh water in the southern regions are LLC LUKOIL-Astrakhanenergo and LLC LUKOIL-Rostovenergo, although the share of consumption by these organizations in the total fresh water consumption of the respective regions is negligible. For example, in the Rostov Region it is less than 0.01%Based on data from the State Report "On the Condition and Utilization of Water Resources of the Russian Federation in 2016," the total consumption of fresh water in the Rostov Region was 2,212.1 million .

Among the foreign countries in which LUKOIL Group operates, Uzbekistan and IraqLUKOIL Group entities also operate in Kazakhstan and Egypt, which are also low-water regions. However, in these regions LUKOIL does not perform extraction work. belong to the category of low-water countries. In these countries there are risks of frequent droughts, inadequate supplies of drinking water, and interruptions in the supply of clean, fresh water to the local population. Apart from climatic conditions, the situation is exacerbated by social factors: an insufficiently developed utility infrastructure and a high depletion level of the resources of water-supply systems.

LLC LUKOIL Uzbekistan Operating Company operates in the Bukhara and Kashkadarya regions, as the operator of one of the Company's priority natural gas extraction and processing projects at the Kandymskaya and Gissarskaya groups of deposits. Most of the Bukhara Region is covered by the Kyzylkum Desert, therefore the water supply of the region is far lower than that of the rest of the country.

In Iraq there is a critical situation with the water supply, due to increasing desertification and a reduction in reserves of terrestrial water resources.

In order to help the local population in both countries, LUKOIL Group entities implement a number of social projects, one of which is to provide drinking water to children's institutions and assisting in organizing the extraction of water to irrigate gardens. In Iraq in 2018 most attention was paid to renovating and re-equipping water treatment and water pressure plants that supply water to local villages, in particular, those in the Izeddin Salim administrative district.

Projects to assist in supplying drinking water to local populations in 2018