Trade and Marketing

G4-8, G4-6,
G4-9, G4-13,
G4-PR5

Wholesale and retail trade in oil and petroleum products covers Russia, Europe, South Eastern Asia, Central and Northern America and other regions, totaling 27 countries. The Company possesses an extensive logistics and distribution network, including in-house offshore terminals and tank farms. G4-8 Trading is carried out through the LITASKO subsidiary in over 100 countries. G4-6

Almost half of our engine fuels are sold through retail. The LUKOIL Group marketing network is the main channel of engine fuel sales; as of late 2016, it had 5,309 filling stations In-house, rented and franchised, including cold stacked. , half of which (2,603) were based in Russia. Most retail sales in Russia take place in the Southern, North Western and Volga federal districts. Sales of premium products such as ECTO gasolines and fuels and Genesis lubricants have grown. G4-8

in 18 countries In 2015–2016, the marketing network in other countries was optimized through the sale of filling stations in Ukraine, Estonia, Poland, Latvia, Lithuania and Cyprus. G4-13 serve as location places of our marketing assets

The LUKOIL Group delivers petroleum products to airports in Russia and abroad, as well as marine fuel to sea and river ports of Russia, Bulgaria and those on the Danube. G4-8

In 2015, 2.8 million tons of aviation bunker fuel were sold and 2.7 million tons were sold in 2016. Fuel was sold through 12 in-house fueling complexes (FC) Including joint enterprises with GAZPROMNEFT-AERO: OOO Yenisey FC (Krasnoyarsk) and ZAO Soveks (St. Petersburg). and new FC were built in Yekaterinburg and Sheremetyevo.

13.9 million tons of petroleum products were sold in 2016 at filling stations G4-9
Bunker fuel sales G4-9

Product Quality Control: from Refinery to End Consumer

A focus on the needs and expectations of end customers, continuous improvement of technologies and an excellent management methodology are key priorities for organizations specializing in oil marketing and the production and sale of lubricants. G4-PR5

Continuous multistage quality control of engine fuel is carried out throughout the entire product supply chain: from refineries to bulk plants, filling stations and fueling complexes.

Bulk plants have accredited laboratories that perform quality control tests on incoming fuels from manufacturing plants. Copies of the quality control certificates issued from these tests are available to the end consumer at filling stations.

Filling stations control the quality of fuel brought in by tankers and the fuel in the filling stations’ tanks are subjected to scheduled checks as well as unscheduled inspections. All petroleum products are subject to mandatory certification. Fuel for inspection is selected at random from filling stations located in different city districts and highways. Mobile laboratories with the equipment to conduct expert analysis of any pollution indicator are used for this testing.

The Group’s plants that manufacture lubricants and specialized liquids analyze consumer demands and work consistently to increase customer satisfaction in accordance with ISO 9001 and ISO/TS 16949 and the requirements of global carmakers. Corporate clients such as General Motors, Ford, Volkswagen, Renault-Nissan and others conduct regular audits of the Company’s plants to assess product quality and production efficiency. An innovative tank authentication system is in place to protect against counterfeiting and to ensure consumer safety.

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