ANNUAL REPORT 2005 - Lukoil

ANNUAL REPORT, 2005
management of technology processes. Investments in industrial and environmental safety will exceed
20% of total capital expenditure on construction of the South Khylchuyuskoye field.
Our work to protect the environment has earned positive assessments from many social organizations
over the years. In 2005 LUKOIL, LUKOIL-Kaliningradmorneft and LUKOIL-Komi were acclaimed as
winners of a contest to find the Russian Environment Leader, which was held as part of the All-
Russian conference 'New State Ecology Policy in the Real Sector of the Economy'.
A rating prepared by the International Social and Ecological Union and the independent ecology rating
agency Nera, supported by the World Bank, judged LUKOIL to be one of the three most successful
Russian companies in reducing negative environmental impact since 2000. The rating included 75
leading Russian companies, and 500 subsidiaries of these companies.
LABOUR AND INDUSTRIAL SAFETY
Measures to maintain labour and industrial safety are governed by LUKOIL's Policy for Industrial
Safety and Protection of Labour and Environment in the 21st Century.
The Company carried out all its planned measures in 2005 for disclosure of hazardous production facilities
and their inclusion in the state register of such facilities, attestation of workplace safety standards,
carrying out of complex and specific checks, and training and attestation of personnel. A sum
of about $230 million was set aside to finance the relevant program in 2005. The money was used to
renew various fixed assets of Group subsidiaries, to build new technological facilities and reconstruct
existing ones, and for installation and upkeep of personnel facilities, as well as improvement of ancillary
assets (reservoirs, loading racks, flares, etc.) and land upgrades.
One of the main aspects of LUKOIL's system for management of labour and industrial safety is prevention
of accidents at work and attestation of workplace safety standards. Over 43,000 workplaces
had been attested as of January 1, 2006. The total number of accidents at work within the Company
declined by almost 25% in 2005 compared with 2004.
Polluted Land, hectares
Liquid Effluents,
million cubic meters
Environmental Spending,
$ million
Spillage of Oil and Petroleum
Products due to Accidents,
tonnes
450
30
400
120
400
350
25
20
300
100
80
300
15
200
60
250
200
10
5
100
40
20
150
2003
2004
2005
0
2003
2004
2005
0
2003
2004
2005
0
2003
2004
2005
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