In 2021 LUKOIL Company turned 30.
Thirty years for the company in total mean:
- sustainable development;
- growth projects;
- quality products;
- safety, ecology, decarbonization.

Main assets of the company are located in more than 30 countries and cover over 60 regions of Russia, while the main areas of activity include geological exploration; oil and gas production; oil and gas processing and petrochemicals; sales and transportation; air refueling; oils production; power generation and reusable energy sources.

Verified strategic decisions, continuous focus at efficiency improvement and costs reduction provide the company with advantages in the market. In it's own turn, this means the use of energy efficient equipment and the development of digital solutions, quality improvement of the output product and progressive development.
It is from the point of view of the application of advanced innovative solutions that cooperation with LUKOIL enterprises forms an important area of VSP's work in the market.

VSP Special Customers represent a distinctive list of companies, engineering centres and end users, as well as commercial structures—production companies of ROSNEFT and GAZPROM, KINEF, SIBUR, UralKhim, SPIK SZMA, LUKOIL Group companies and some others.

VSP has been active cooperating with LUKOIL enterprises all over Russia for more than 20 years. Starting with 2010 this work has been concentrated in a special practice—the LUKOIL Special Customer Program. This kind of focused approach is practiced by VSP in connection to especially large structured customers in Russia, so far as development of relationships with them is not possible without a special approach.

VSP Special Customers represent the basis of our operations, customers generating the bulk of the company business. We allocate maximum possible resources, time and finance to develop relationships with Special Customers.

Development of business with one of the major Russian oil companies—LUKOIL—is founded on the knowledge and expertise which has been acquired by specialists in terms of other program initiatives carried out by our company. Real possibilities and prospects of operation in the market are determined by the quality of VSP partners' solutions, by the manufacturers with the worlwide reputation and an extensive installed park of equipment.

LUKOIL Group has proven hydrocarbon reserves in eight countries around the world. The main part of the reserves belongs to the category of traditional—this is the most important competitive advantage that provides the Company with low unit costs for development and production.

LUKOIL is pioneering in development of the Russian sector of the Caspian Sea floor. About 20 years ago Yuri Korchagin and Khvalynskoye oil fields were discovered, and five years later the largest oil field in the Russian Caspian sector was discovered named after Vladimir Filanovsky. Furtheron a new oil&gas bearing province was formed due to the company efforts with recoverable reserves exceeding 7 bln barrels.

The Northern Caspian waters were not studied well enough at that time, but the probability of finding significant hydrocarbon reserves was estimated high by experts. The company took a risk, given the high costs of offshore production, and over time nine fields were discovered.

Starting with 2018, the level of oil production at the oil field named after Filanovsky has been kept at the projected level of 6 mln t/year. The field is being developed in three stages.

The first stage of the field development was completed in 2016. It includes an ice-resistant stationary platform, a residential module platform, a riser block and a central technological platform. The second stage, commissioned in 2017, consists of an ice-resistant stationary platform and a residential module platform. The third stage has been put into operation in 2019 and includes a block-conductor (mini-platform).

Operation on sea platforms puts forward special requirements as to reliability and safety of equipment, as well as to accuracy of measurements, especially in terms of custody oil transfer operations. In order to turn potential into reality, apart from technologies and other factors, the equipment is required, which is cabable of working at the maximum depth, capable of withstanding extreme temperatures, of high quality and reliability, light weight and providing for environmental safety.

Technical solutions, which have been presented for several decades by VSP in the market for providing intrinsic safety, metering process parameters, in terms of instrumentation products and HMI equipment are widely used at LUKOIL sites—from oil processing to oil production.

Equipment for off-shore platforms is one of the Parker Hannifin expertise.

Parker Hannifin solutions provide for operation across a wide pressure range—from vacuum to 10 000 bars, under temperatures from cryogenic to over 600 °C. This would indeed allow for practical implementation of any technical task, from simple mechanical connection to a complex multicomponent hydraulic control system.

Leading oil companies, LUKOIL included, follow rigid standards of the Norwegian oil industry. Most of the projects related to construction of stationary sea complexes include compliance with the NORSOK international standard as a must.

Parker Hannifin Instrumentation products group is the manufacturer of fittings and provider of other technical solutions (6Mo material) which fully comply with the NORSOK M-650 standard.

The works carried out by VSP on testing another supplier of instrumentation products allowed for using the equipment of Panam Engineers in a number of VSP projects for drilling platforms as well: instrumentation products, manifolds, fittings, valves.

The oil in the Caspian fields, which LUKOIL is developing, lies at a depth of about 4 km and by its composition is difficult to recover: its high density (specific gravity—0.95 g / cm3) allows it to be attributed to bituminous oil, for the extraction of which a special installation is required. When extracting fuel oil from this raw, a massive salt deposit remains, and the resulting bitumen contains a lot of paraffin.

Transportation of oil is by an underwater pipeline and by using shuttle-tankers.

When operation at sea platforms is considered, special requirements are set forward regarding reliability and safety, as well as to the accuracy of measurements, especially for custody metering. VSP avails of experience in supplying equipment for two LUKOIL platforms and the infrastructure.

VSP projects related to density and viscosity metering at sea platforms include various applications as well: ranging from Emerson Micro Motion equipment for quality control systems and for oil and oil products custody metering installations which constitute part of technological systems at sea drilling platforms.

It was the Solartron 7812 densitometer that was used initially for gas density metering at platforms. Since 2014 Emerson Micro Motion switched to a new generation of density and visco meters, in which advanced technological and engineering solutions have been fully implemented. At the same time, an upgraded range of equipment retained all the main advantages of the widely known series 7800 density and visco meters.

By the enquiry of our customer, for the upgrade of a metering gas installation at the external platform infrastructure (the Korchagin sea ice-resistant platform), the SGM Micro Motion was offered, a new generation meter providing for direct and highly sensitive gas density metering.

Historically VSP has acquired over 20 years of experience in working with Micro Motion (former Solartron) metering devices. The VSP project approach in liquid and gas parameters measurements has been successfully implemented in cooperation with the VSP Special Customer—LUKOIL.

We may quote a number of projects by VSP as examples of viscosity and density analyzers application at LUKOIL enterprises.

From the VSP news feed.

Starting with early 2006, the Lukoil-Ukhtaneftepererabotka enterprise has put into pilot operation the Solartron viscosity measurement system for boiler fuels and fuel oils at the preparation and mixing technological unit.

The working design and installation of the equipment was carried out by specialists of the Lukoil-Ukhtaneftepererabotka. The supply of equipment for the systems including measurement instruments, supervision and technical support at the commissioning stage on site were carried out by VSP specialists.

In June 2010 LUKOIL carried out an open tender for supply of liquid density and viscosity meters manufactured by Mobrey.
As per results of the tender VSP has been recognised the winner. The meters are intended for use at sites belonging to the LUKOIL group, including the Varandey terminal as well.

The LUKOIL group in Russia comprises four oil refineries—in Perm, Volgograd, Nijniy Novgorod and Ukhta. The depth of oil processing (not covering mini oil refineries), in 2020 reached 91,4% (88,7% in 2019).
The last few years have been marked by an active modernization of production at oil refining and petrochemical enterprises. One of the key factors was the high quality of LUKOIL's processing facilities. Many years of efforts to modernize refineries and develop vertical integration have produced excellent results. The construction of new installations at Russian refineries launched in 2021 has continued, and will have a positive impact on the structure of output products.

VSP has been cooperating with LUKOIL ORs along all the lines of the VSP business. For example, MTL equipment is a preferable intrinsically safe interface and is integrated into critical application systems. In this connection the defining factors when choosing intrinsically safe equipment are: quality and reliability, metrological characteristics, operational experience, innovative design and technological solutions, pricing policy and cost of ownership.

For example, MTL intrinsically safe interfaces and systems have an excellent reputation at Permnefteorgsynthez. The MTL4500 series isolators are at the core of the intrinsically safe interfaces of the filtration unit control system at the filling installation; as well as control systems of the other technological processes.

Some process installations at Lukoil-VolgogradNeftepererabotka, in particular Unit No10 cotrol system, and the oil products transportation and storage control system include MTL4500, MTL7700 series IS barriers as well. The control system at Lukoil-UkhtaNeftepererabotka uses MTL4500 in the control system of the 35-11/300 installation in isopentane removal process scheme.

Eaton Electric (former MTL Instruments) has been the first manufacturer of measurement and control equipment to be certified for compliance with Functional Safety Management (FSM). For today, MTL engineering solutions in line with SIL requirements of functional safety standards, up to the SIL3 level, are used at critical processes as part of DCS and emergency shut down systems by western and Russian integrators.

LUKOIL is a major supplier of polymers, pyrolisis and organic synthesis products into the Russian market. At the same time it is the exporter of petrochemical products into over 30 countries worldwide.
The petrochemical strategy of the company is based on oil refineries.

In the nearest six years LUKOIL is going to invest $3 bln into modernisation of its oil refineries by way of commissioning petrochemical production facilities.

Lukoil-NijegorodNefteorgsynthez is one of the largest OR of the company, and one of the largest in the country. Its nominal capacity for oil refining amounts to 17 mln tons per year.

Preparation of construction sites for a petrochemical complex is completed at Nijegorodsky OR. The complex will be focused at polyethylene and polypropylene production in the amount of 500 thousand tons per year. In 2020 the construction of a delayed coking unit and isomerazation plant continued. Commissioning of the delayed coking unit at the OR would allow to cut down on fuel oil yield to 4% across the group on the whole.

The raw materials for the complex are heavy oil refining residues, and the main types of products are diesel fuel, straight run gasoline and gas fractions, as well as dark oil products–-vacuum gas oil and coke.

Operation of every process unit of a plant is dependant on the accurate operation of all the equipment, in particular on the work of pumps and compressors. Failure of a pump, supplying the unit with the raw material, would cause shutdown of all the equipment and may lead to a serious accident. Such a dependence of the operation of the entire installation on the operation of pumps and compressors requires constant supervision of this equipment.

Many of the oil refineries, Nijegorodsky OR including, have used GECMA remote EX-terminals for compressor control, for example, at catalytic cracking installations. GECMA remote terminals improve functional reliability of compressor units, cut down the personnel requirements, support energy savings on compressor installations.

LUKOIL is starting preparation for construction of the installation for deep processing of hydrocarbons at the Lukoil-Permnefteorsynthez site.
'A specific feature of the complex is a high controllable polypropelene yield'—reads the company message.
The commissioning of the complex is planned for 2026. It will provide for the increase of high-octane automobile fuels production, and will also allow to produce propylene of polymerization purity enabling to use it as a raw material for the company petrochemical product units.

VSP has a rather long history of relations with Lukoil-Permnefteorgsinthez. As an example, we can cite the teamwork of representatives of Parker Hannifin, VSP and specialists of the customer, Lukoil-Permnefteorgsintez.

So, in May 2016 a team of Parker Hannifin and VSP specialists had been working in Perm for a few days. During the business trip one of the units of the plant was investigated, some preliminary suggestions on additional optimization of the engineering units were made. Besides, several specialised Parker Hannifin solutions to eliminate leakages were presented: PTFree manifolds, monoflanges, FCC flange connectors.

Alternative energy must be accessable and there should be enough of it, so that not only to gradually cut down dependence on fossil fuels, but to provide additional volumes for the growing world economy. As the example:

LUKOIL started supplying electrical energy to Stavrolen (Budennovsk) petrochemical plant. The energy is produced at the proprietary solar electric station which is located at the Volgogradsky OR site. Annual electricity supply will be about 11 mln kW/h. Solar electric station in Volgograd was commissioned in 2018 with the nominal capacity of 10 MW. After the second stage had been launched in May 2021 the output of the station was raised up to 30 MW.

Stavrolen LLC is a petrochemical company, one of the leading Russian producers of polyethylene and polypropylene. In 2021, LUKOIL started construction of the 2nd gas processing plant complex—the project will be one of the largest in the south of Russia. The construction of GPU-2 will increase the intake of associated petroleum gas from the fields of the Northern Caspian to 5 bln m3/year.

This way, the volume of valuable raw materials for pyrolysis will increase, which will make it possible to increase the output of commercial products. At the beginning of 2021, the company was the first in the Stavropol Area to be licensed for the production of medical oxygen.

It is expected that the use of electricity produced from renewable energy sources will reduce the carbon footprint of Stavrolen's products bringing down the indirect energy emissions of greenhouse gases by almost 5 thousand tons of CO2 per year.

The technical solutions presented by VSP in the market are well known at Stavrolen too. Cooperation of VSP with a number of DCS companies and Russian integrators, as well as direct contacts with the end-user provided for supply of instrumetation products for metering sites, and MTL interfaces too.

There is no scenario suggesting a complete rejection of fossil fuels. That is why hydrocarbons are going to keep their important role in the world energy balance as a raw material for consumer goods production. Under such conditions oil&gas industry has to focus at producing the most efficient barrels, which have to be specifically different from the point of view of their production carbon footprint.

Responsible Producer of Hydrocarbons strategy by LUKOIL provides for persistent and consistent efficiency improvement and cost reduction. LUKOIL has launched a comprehensive digital transformation program Digital LUKOIL 4.0. Implementation of the program foresees an increase of the production by 2-3%, the labour productivity by 10%. By eliminating unnecessary links in a number of existing processes and as well as unnecessary operations, costs could be reduced by 15-20%.

An interesting and important LUKOIL project in the field of digitalization is the introduction of the concept of an intelligent oil&gas field. The example of the Digital Production Site is presented by the Shershnevskoye field in the Berezniki district—one of the most advanced automated site in LUKOIL-PERM.

The smart deposit system is based on the idea of a careful use of the deposit, the maximum extension of its operational period. Another important task of the smart deposit concept is to increase the energy efficiency of equipment and technological processes. Thus, the implementation of this concept helps companies to reduce energy costs and leads to a cumulative reduction in carbon dioxide emissions into the atmosphere.

Another LUKOIL project is a Digital ASTRA, a fully functional system, deployed and operating on a real oil platform in the Caspian Sea, and not just a prototype at all.

In the same way as a successful digital project requires 'a team—data acquisition and analysis, customization—history and expertise', VSP work in terms of LUKOIL Special Customer Program comes into life in cooperation with customer specialists, is based on understanding of the technical task and special requirements, has its history and development. The VSP Project approach allows for realization of tasks of our customers from LUKOIL Group with the maximum efficiency based on the best technical solutions available in the market.