Project Description
The proposed project consists of a strategic environmental programme aiming at rehabilitating or enhancing the environmental, health and safety performance of various upstream, midstream or downstream facilities operated by oil company Lukoil in the Bank’s countries of operation. The scope includes inter alia pollution clean-up, pipeline replacement, gas flaring reduction, health and safety measures, social infrastructure, energy efficiency and other environmental remediation investments and specifically excludes production related investments that do not have an over-riding environmental benefit.
Lukoil’s strategic environmental programme will be implemented over the disbursement period of the loan upon the communication by Lukoil to the Bank of call-off notices for each individual environmental investment providing detailed information on use of proceeds, anticipated results, schedule for major activities, required permitting process, public consultation requirements, reporting and monitoring by EBRD.
Transition Impact
The Project is an environmental project designed to remedy past liabilities and enhance the environmental performance of Lukoil’s operations. The transition impact objectives are:
(i) the demonstration of a replicable large scale environmental clean-up programme creating a benchmark for other Russian corporates in the natural resource sector and
(ii) the implementation of high environmental standards guaranteeing the long term sustainability of oil operations. The objective of this programme is to achieve compliance with national as well as international and relevant EU environmental standards. Such compliance will be assessed on a project by project basis as the detailed designs are available. It should be noted that the pilot project reviewed as part of the Bank’s environmental due diligence complied with all relevant EU environmental standards.
The Client
Lukoil is the 2nd largest oil company worldwide by proven reserves and the 6th largest by oil production. The Company is no.1 in Russia for oil, accounting for 18% of Russian production. Lukoil is traded on the Russian Trading System and the London Stock Exchange.
EBRD Finance
The investment is a USD300 million corporate senior unsecured loan to Lukoil to fund the project, of which an up to USD150 million A loan and an up to USD150 million B loan to be syndicated to commercial banks.
Project Cost
USD 300 million.
Environmental Impact
All projects under this loan facility are of an environmental nature and the implementation of such will result in environmental benefits. For example, a pilot project reviewed for this loan will result in development of an industrial wastewater treatment plant for a facility that currently relies upon treatment in the local municipal treatment plant. The new treatment plant will be designed specifically for the waste stream generated and will satisfy all national and relevant EU environmental standards. Further, by constructing this plant, the existing municipal system will now be able to treat wastewaters generated at other local industries that currently are discharged with little or no treatment. Future projects to be included in this loan will satisfy pertinent national environmental standards, and the intent is to satisfy relevant EU environmental standards. Such compliance will be assessed by the Environment Department on a project by project basis.
Technical Cooperation
None.
Company Contact
OAO Lukoil
11, Sretensky Boulevard, Moscow 101000, Russia
Website: www.lukoil.com
Enquiries: http://www.lukoil.com/back/query_6_.html
Tel/Fax: +7 (495) 627 4444
Business opportunities
For business opportunities or procurement, contact the client company.
For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com
General enquiries
EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com
Public Information Policy (PIP)
The PIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP
