“LUKOIL” is one of the largest international oil companies. The company extracts oil both in Russia, and behind its limits. “LUKOIL” posesses oil refining factories in Russia, East and the Western Europe. The marketing network of “LUKOIL” covers over 20 countries, “LUKOIL” wins the first place in the USA on the number of gasoline stations.
Strategic partner of the “LUKOIL” is a company ConocoPhillips. ConocoPhillips owns a blocking share holding of the “LUKOIL”. The representatives of the ConocoPhillips are included into the board of the directors “LUKOIL”, the companies carry out the joint projects.
Open Society “LUKOIL” actions bargain at the Russian and foreign stock exchanges, enter into a number of the “blue counters” Russian stock market.
The proved stocks of oil of the company for January, 1st, 2007 have made 20,36 billions barrels of an oil equivalent, including 15,93 billions barrels of oil and 26,60 billions cubic foots of gas. The company posesses 1,3 % of universal stocks of oil.
More than a half of stocks of oil of the “LUKOIL” it is concentrated in Western Siberia. About a half of stocks of natural gas it is in the deposits located on Gydansky peninsula.
Transportation
Transportation of the oil extracted by the “LUKOIL” in Russia, is carried out generally by pipelines “Transneft”, and also railway and a sailing charter.
Central office of Lukoil
“LUKOIL” posesses variety of the oil and petrogrocery terminals used for export of oil and oil products:
• the Terminal in port Vysotsk (gulf of Finland of Baltic sea) capacity of 10,7 million barrels oil and oil products in a year.
• the Terminal near to settlement Varandej (Barents sea) capacity of 1,5 million barrels oil in a year.
• the Terminal in port Light on Baltic sea capacity of 6 million barrels oil and oil products.
• Terminal “Astrakhan” (Astrakhan region) capacity of 2 million barrels oil and oil products.
Sale
The network on sale of oil products of the company “LUKOIL” covers 19 countries of the world, including Russia, the CIS countries (Azerbaijan, Belarus, Georgia, Moldova, Ukraine), the states of Europe (Bulgaria, Hungary, Cyprus, Latvia, Lithuania, Poland, Serbia, Romania, Croatia, Czechia and the USA. The company posesses 199 tank farms and 5 830 gasoline stations.
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| Lukoil gas station in the U.S. | Vagit Alekperov and Valeriy Graifer – Lukoil’s key people |
Retail of oil products is carried out generally under trade mark LUKOIL. In the USA the part of the filling stations of the company works under trade marks Getty and Mobil.
In July, 2008 “LUKOIL” has agreed about purchase of Turkish company Akpet to which posesses 693 gas stations, eight petrogrocery terminals, five storehouses of the natural gas, three aviafuelling complexes and factory on manufacture and packing of engine oils in territory of Turkey. The sum of transaction has made the little more than $500 million
The analytical information
Company’s financial results
| 2006 | 2007 | 2008 | 2009 | 2010 | |
|---|---|---|---|---|---|
| Revenue, USD bln | 67.7 |  82.2 |
107.7 |
 81.1 |
105 |
| Net income, USD mln | 7.5 | 9.5 |
9.1 |
7.1 |
9.0 |
High stock rate
“LUKOIL” occupies a leading place among the Russian companies on volume of stocks of hydrocarbons.
Qualitative resource base
On the biggest parts of the deposits of “LUKOIL” high-quality oil lies down. Geological indicators of deposits of “LUKOIL” also it is better than the others in this sphere. Level of an exhaustion of the stocks is considerably below averages across Russia.
Equation
The volume of extraction of raw materials corresponds to capacity of oil refining factories, and the size of a retail network allows to realize made oil products independently.
Partner relations with the state“LUKOIL” solves infrastructural questions with ease, successfully cooperating with “Transneft”, “Transmineral oil” and the Russian Railway. “LUKOIL” acts as the representative of Russia in the international project of working out of a deposit Hvalynsky that shows the favorable attitude to the company from the state.
Foreign actives
The branches of “LUKOIL” are present at all important regions connected with extraction and oil refining, and also sale of oil products. In particular, “LUKOIL” conducts extraction of hydrocarbons in Saudi Arabia, in Egypt, in the Caspian region. The company posesses a number of oil refining factories in Europe. Gasoline stations “LUKOIL” are located in many countries of the world, including in the USA.
The big share of actions in the free reference
In stock market the considerable share of actions of LUKOIL, by some estimations – close to a controlling stock addresses. Such actions involve long-term investors.
Stably growing dividends
The company annually raises the size of paid dividends.
Weaknesses:
Not clear prospects of foreign projects
There is no full confidence that the large-scale projects realized by the company outside of Russia, will make expected profit. In particular, “LUKOIL” has some years ago got a large marketing network in the USA, however at the company isn’t present oil refining factory on the American continent, and delivery of oil products from other has hight price.
Conclusion:
The recommendation: to BUY
“LUKOIL” possesses strong fundamental indicators. The state supports in many projects to “LUKOIL” in spite of the fact that it has no in the property of shares of company.
Official Website: www.lukoil.com