A LUBRICANTS COMPANY PUBLICATION JULY 2017 Approvals/ Meets requirements of:

• MB-Approval 228.5 • MAN M3277 • Volvo VDS-3 • Scania LDF-3 • Caterpillar ECF-2 • Cummins CES 20077/72 • Renault RLD-2, RXD • Ford WSS-M2C212-A1 • Deutz DQC IV-10, III-10 • MTU Category 3 • DAF Extended Drain • MACK EO-N, EO-M PLUS

API: CI-4, СF ACEA: E4/E7 SAE: 5W-30, 10W-40

SYNTHETIC MOTOR OIL LUKOIL AVANTGARDE PROFESSIONAL

Extended oil change interval

* Compared to ACEA E4 requirements ** Compared to ACEA E7 requirements *** Compared to ACEA E7 requirements CONTENTS

AWARD PRODUCT 2 ’s best 12 Ultra quality for supplier agricultural sector

COOPERATION PRO PROFILE 4 LUKOIL strikes new 14 Marine in all he does! partnerships with Peugeot and Citroёn COOPERATION 5 chooses LUKOIL 16 Eastern dealers tour Perm again facility 6 Our lubes for Moscow’s bus fleet ACHIEVEMENT 6 LUKOIL signs deal with 17 June Manoharan 2 is the Woman Maritime Personality CORPORATE AFFAIRS of the Year!

7 First success FORUM at metalworking fluids 8 rеsearch lab 18 Volgograd hosts industry business forum ANNIVERSARY INTERNATIONAL BUSINESS 8 LUKOIL Lubricants East Europe celebrates 10th 20 We build presence, enter anniversary! new European markets

COOPERATION PRO PROFILE 10 Service fill oils for Toyota’s 22 Meet Matthias Margl 12 special-purpose machinery EXHIBITION 11 LUKOIL begins cooperation with Liebherr in 24 Getting closer to Mexico 11 New approvals, first fill deal CORPORATE AFFAIRS with Palfinger 25 “Perspective 2017“ is a talent draw 14

LUKOIL LUBRICANTS, Phone: +7 495 980 3912 July 2017 E-mail: [email protected] LUKOIL LUBRICANTS is a LUKOIL Lubricants Company Press run: 999 publication The magazine is registered by the Federal Publisher: RPI Service for Media Law Compliance and Cultural Address: LUKOIL Lubricants Company, Heritage. 6 Malaya Yakimanka, Moscow 119180 Registration certificate ПИ №ФС77-28009

LUKOIL LUBRICANTS | July 2017 1 AWARD

AUTOMOTIVE INDUSTRY’S BEST SUPPLIER

UKOIL won the 2016 Best Supplier and Volgograd) as per ISO/TS 16949:2009 stan- award in the contest held by the Russian dard. Among domestic companies the Russian Automotive Forum (RAF), which high- lubricants market leader also had the biggest lighted the Company’s achievements as number of car producers’ product approvals. supplier of lubricants to international Some of those unique approvals were Russia’s Lcar manufacturers. The award ceremony took first, and some others were the first in the place in Moscow on March 15 during the RAF world. We couldn’t overlook these achieve- 2017 conference organized by Adam Smith ments, and LUKOIL is the deserving winner of Conferences. the ‘Best Russian Supplier’ award,” RAF 2017 “Over the last year, this company made organizers said in a statement. some landmark achievements in coopera- As he accepted the award, Alexei tion with international automobile concerns. Moskalenko, LUKOIL Lubricants Company Namely, last year LUKOIL started to deliv- deputy general director for logistics, thanked er lubricants to Ford and Volkswagen’s plants clients and partners for the high valuation in Russia, and continued to cooperate with of the Company’s performance. “It is a spe- Renault-Nissan, GM, MAN, GAZ, , and cial honor for us to win in the ‘Best Supplier’ other car producers. The company was al- nomination, since LUKOIL is the youngest so Russia’s first to certify two plants (in Perm company among the world’s largest lubri-

2 AWARD cant manufacturers. We constant- ly keep learning from you, our col- leagues from the car industry, and we are thankful for that. Car com- panies’ regular audits of our plants have helped us adapt quickly to in- ternational standards in quality management, and raise efficiency of manufacturing and logistics. A de- cade ago, the Company was deliver- ing lubricants exclusively to Russian car producers. Today, we supply first

CAR COMPANIES’ REGULAR AUDITS OF OUR PLANTS HAVE HELPED US ADAPT QUICKLY TO INTERNATIONAL STANDARDS IN QUALITY MANAGEMENT, AND RAISE EFFICIENCY OF MANUFACTURING AND LOGISTICS

fill products to over 20 foreign and Russian automakers. Meanwhile, we are beginning to switch from first and service fill agreements in indi- vidual countries to similar deals on a global scale,” said Moskalenko. Russia’s main event devoted to domestic car industry featured all major players. We need to note that LUKOIL was named Russia’s best sup- plier not only among lubricant com- panies, but also among car compo- nents and consumables producers!

LUKOIL LUBRICANTS | July 2017 3 COOPERATION

UKOIL has signed a contract with Peugeot Citroën Rus for delivery Lof service fill lubricants in Russia. Peugeot, Citroën and DS official deal- erships will use LUKOIL GENESIS SPECIAL and GENESIS ADVANCED engine oils. “LUKOIL strives to develop busi- ness ties with the world’s key car manufacturers. Such companies as PSA Group determine present-day and future requirements regard- ing lubricants. Today, we attentively study specifications of oils required for first fill at PSA’s car factories, and we intend to boost cooperation both in Russia and in foreign markets,” said LUKOIL Lubricants Company general director Maxim Donde. LUKOIL STRIKES “In its effort to build the scope of aftersales services for different types of our car brands in Russia, PSA NEW PARTNERSHIPS Group is interested in cooperation with a local company, which is able to supply to us universal engine oils WITH PEUGEOT of high quality, officially approved by the majority of car manufactur- ers with a presence in the local mar- AND CITROЁN ket. We are glad to begin our cooper- ation with such a reliable partner as LUKOIL,” said Yevgeny Boldyrev, PSA PSA Group manufactures cars un- brand. Following this year’s acqui- Groups director for aftersales ser- der Peugeot, Citroën and DS brands, sition of Opel and Vauxhall brands vice and spare parts in the Eurasian and also offers different mobili- from General Motors, the French car region. ty services under the Free2Move manufacturer has become Europe’s second-largest car pro- ducer, capturing a 17-per- cent share of the mar- ket. PSA is a European

leader in reducing CO2 emissions with an aver- age of 102.4 g/km in 2016 and is one of the pio- neers in development of driverless and connect- ed cars (2.3 million such cars already being used). The Group’s business interests also include the finance sector (PSA Finance bank) and car components manufactur- ing (Faurecia).

4 COOPERATION SEVERSTAL COOPERATION CHOOSES LUKOIL AGAIN

LUKOIL HAS WON A MAJOR BID TO SUPPLY MODERN ENGINE, HYDRAULIC, AND GEAR OILS TO A NUMBER OF KEY COMPANIES IN SEVERSTAL GROUP’S STEELMAKING AND MINING DIVISIONS

ccording to the contract, by the end of this year LUKOIL will sup- We are dynamically replacing Aply about 2,700 tons of lubricants both imported lubricants and to Severstal, Izhora Pipe Mill, Severstal GOST specification products at Balakovo Long Product Mill, Karelsky our partners’ steelmaking plants, Okatysh, Vorkutaugol and Olkon. helping them achieve higher ef- Severstal includes Severstal Russian ficiency in operation of industri- and Severstal Resource divisions. al equipment. Besides Severstal, Severstal Russian Steel is one of Russia’s the largest buyers of LUKOIL lu- largest steelmakers, specializing in pro- bricants are duction of rolled steel with a high added (NLMK), Magnitogorsk Iron and value. The division includes plants man- Steel Works, Chusovskoy Iron and ufacturing large diameter pipes, metal Steel Works, TMK, Metalloinvest. products for industry and general-pur- RASIM AMIRALIYEV Today’s level of LUKOIL’s R&D en- pose use, as well as service centers and deputy general director, sales ables us to set new industry stan- stamping plants producing car parts. dards through development of Severstal Resource includes all new generation lubricants for of Severstal’s mining assets, covering steelmakers. For example, such Severstal Russian Steel’s entire demand for innovations are LUKOIL GEYSER HFDU fireproof biodegradable hydrau- and hard coking . It also sells lic oils and LUKOIL INTEGO product line for rolling mills, with unique raw materials to external customers. water separation properties.

LUKOIL LUBRICANTS | July 2017 5 COOPERATION OUR LUBES FOR MOSCOW’S BUS FLEET

of tests of LUKOIL AVANTGARDE in Mosgortrans’ bus fleet, offering PROFESSIONAL LS 10W-40 motor oils that meet the latest require- oil in MAN diesel engines compli- ments of foreign engine manufactur- ant with the Euro-5 environmental ers,” said Rasim Amiraliyev, LUKOIL standard. The product performed Lubricants Company deputy general excellently under difficult urban director, sales. driving (start-stop) conditions and Mosgortrans is Europe’s larg- during lengthy idle engine runs. est operator of urban ground pas- The test results revealed minimal senger transportation. The compa- traces of wear in the oil. ny operates more than 740 routes “Mosgortrans is one of our stra- and carries over 5.5 million passen- UKOIL has won Mosgortrans’ new tegic clients, and we highly appreci- gers daily. Mosgortrans’ vehicle fleet tender to supply lubricants in ate the partnership with the compa- numbers around 8,500 vehicles, in- L2017 for the bus fleet of Europe’s ny based in the Russian capital. Since cluding nearly 6,400 buses with largest public transport operator. 2012 LUKOIL has been successful in MAN, Scania, Mercedes, Cummins The bid was preceded by a series substituting imported lubricants and Deutz engines.

LUKOIL SIGNS DEAL WITH AVTOTOR

UKOIL has signed a contract with high quality com- AVTOTOR Holding to deliver first ponents and ma- Lfill lubricants for the Kaliningrad- terials for the new based car manufacturer’s new line of project. The choice small-sized diesel engines. LUKOIL of LUKOIL as our synthetic engine oils will be used in supplier is the re- modern diesel engines with a 1.5 kW sult of successful to 56 kW power range, serving differ- tests of Russian oil ent branches of industry. in new engines,” “In 2016, we launched produc- said AVTOTOR Holding general di- ber of foreign cars manufactured in tion of AVTOTOR low-power en- rector Alexander Sorokin. Kaliningrad. In the nearest future, we gines, which are used in construc- “We count on further expansion of shall offer AVTOTOR new interesting tion, warehouse and agricultural cooperation with AVTOTOR, the larg- options for mutually beneficial coop- machinery, as well as small-size ves- est multi-brand car manufacturer in eration,“ head of LUKOIL Lubricants sels. AVTOTOR is interested in ex- Russia. Earlier, LUKOIL had already Company OEM Cooperation Dept. panding the network of suppliers of delivered first fill oils for a num- Maxim Myskin said.

6 COOPERATION CORPORATE AFFAIRS

FIRST SUCCESS AT METALWORKING FLUIDS RЕSEARCH LAB

aving set the goal to become LUKOIL FREO MP 65L, for mechani- Russia’s leading player in the cal metalworking. Hmetalworking fluids market, “LUKOIL is going to offer distinc- the Company decided to develop its tive solutions to the market, on a par ALEXANDER PETUKHOV own unique formulations instead with the most advanced Western prod- head of product test support of relying on the additive produc- ucts, and better adapted to Russian department, r&d division ers’ ready-made solutions. As part of conditions. The Company creates ‘niche its effort to implement this strategy, products’ that can accommodate specif- LUKOIL unveiled an R&D laborato- ic requests of any customer. Our own LUKOIL owns laboratories at all of ry in Perm, which is going to serve as R&D solutions and the state-of-the-art its Russian oil refineries, however, the base for making new metalwork- laboratory will enable us to expand our the majority of those specialize in ing fluids and other specialty prod- portfolio of metalworking fluids to 20 quality control. Our new laborato- ucts used in different branches of in- items as early as the end of this year,” ry in Perm is located on the premis- dustry. says specialty products project leader es of the experimental and rese-arch The Perm research lab began Artyom Chaltsev. shop of LUKOIL’s plant, and focus- operating last spring. Since then, LUKOIL plans to offer an integrat- es on development of specialty prod- five new products have been deve- ed solution for metalworking indus- ucts such as metalworking fluids, loped here: four oil-based met- try companies by creating a prod- corrosion-resistant compositions, alworking fluids — LUKOIL INSO uct portfolio that would encompass commercial cleaners, oils for pres- S32, INSO D15, INSO А8 and INSO the full process cycle of manufactur- sure metal treatment and other pro- М22, and the unique LUKOIL FREO ing, treatment and parts storage. Such cess liquids. The Perm lab excellently MS3060A water soluble metalwork- an approach, LUKOIL experts be- complements the Company’s re- ing fluid for treatment of alloys lieve, would also benefit the clients search lab in Tyumen where many of in aviation and airspace industry. since it would help optimize logistics our lubricants are made and tested. Earlier, the Company had produced and solve the issue of compatibility of The Perm facility has all necessary two water soluble metalworking products used in different production equipment for making formulations, fluids, LUKOIL FREO MP 15L and operations. reformulating and testing products.

LUKOIL LUBRICANTS | July 2017 7 ANNIVERSARY

LUKOIL LUBRICANTS EAST EUROPE CELEBRATES 10TH ANNIVERSARY!

IN THE SPRING, OUR SUBSIDIARY, LUKOIL LUBRICANTS these activities helped us make the EAST EUROPE, CELEBRATED IN PLOESTI ITS 10TH manufacturing process very flexible: we were able to expand our prod- ANNIVERSARY OF OPERATIONS IN THE LUBRICANT uct range, efficiently produce small MARKETS OF SOUTH AND EAST EUROPE batches on specific orders, and locally produced lubricants became compli-

t the end of 2006, LLK and required an upgrade. In 2011, we Lubricants Romania was installed a new blending module. The registered in Romania, new system was fully automated, and and later renamed into it enabled us to produce modern high LUKOIL Lubricants East specification oils. By 2014, we had re- AEurope (LLEE). The company be- newed our base oil tank farm, and in- gan to operate in May 2007. As part stalled the latest filter systems. All of LUKOIL’s new business devel- opment strategy, LLEE incorporat- ed lube-blending facilities located at IN 2017, THE MAIN BULK OF PETROTEL–LUKOIL in INVESTMENTS WILL BE ALLOCATED Ploesti. TO BOOST BRAND AWARENESS “In 2007, blending operations at IN THE REGION, AND MARKETING the plant were carried out by using EVENTS TO PROMOTE LUKOIL equipment that dated back to 1958, LUBRICANTS

8 ANNIVERSARY LUKOIL LUBRICANTS COMPANY GENERAL DIRECTOR MAXIM DONDE, RIGHT, AND LUKOIL LUBRICANTS EAST EUROPE HEAD FELIX DRAGU GATHERED ROMANIAN BUSINESS MEDIA REPORTERS AT A PRESS CONFERENCE TO SPEAK ABOUT KEY ACHIEVEMENTS AND PROSPECTS FOR THE SUBSIDIARY COMPANY’S FURTHER DEVELOPMENT ant with modern-day requirements,” noted LLEE head Felix Dragu as he spoke about the key changes that have since taken place at the Ploesti lubricants plant. Today, the product range of LUKOIL lubricants in Romania fea- tures more than 300 items. The uct lines as LUKOIL GENESIS and would open a new interesting chap- plant’s manufacturing capaci- AVANTGARDE PROFESSIONAL. These ter in the Company’s history. ty stands at 40,000 tons per year. were not simply the premium prod- “LUKOIL is making intensive ef- A modern research laboratory, and ucts, they represented a new philos- forts to develop global partnership highly qualified staff facilitate pro- ophy that we offered to customers. with European car manufacturers, duction of virtually any type of oil, In Ploesti, the Company produced for and in this regard we aim to use pro- meeting requests of the most de- the first time its flagship oils. duction capacity at our European manding clients. At a gala dinner, organized for plants to the maximum. The plant in Thanks to production facilities’ LLEE employees, LUKOIL Lubricants Ploesti is located in the very heart of upgrades, LLEE now owns European- Company general director Maxim , it has a very import- level blending capacity. It was here, in Donde thanked the local team of ant role in building LUKOIL’s lubri- Romania, that we first launched man- professionals for these and oth- cants business globally, and that role ufacturing of such advanced prod- er achievements, and wished they will only keep growing!”

LLEE’S BEST EMPLOYEES RECEIVED CORPORATE AWARDS AS PART OF THE COMPANY’S 10TH ANNIVERSARY CELEBRATIONS

LUKOIL LUBRICANTS | July 2017 9 COOPERATION SERVICE FILL OILS FOR TOYOTA’S SPECIAL-PURPOSE MACHINERY

UKOIL has signed a contract to AVANTGARDE ULTRA engine oil, nology and durability of its machin- deliver service fill lubricants LUKOIL GEYSER hydraulic oil, ery. It is an honor for us to sign a Lin Russia for Toyota Material LUKOIL TM4, TM5 and ATF gear supply deal with a second member — Handling (TMH), the world’s largest oil, as well as the FLEX innovative the other being Jungheinrich — of the manufacturer of sophisticated lifting greases. world’s top three machinery mak- machinery. Toyota Material Handling “The improvement of LUKOIL’s ers. The choice of LUKOIL as suppli- RUS’ dealers in all regions of Russia portfolio of premium lubricants and er justifies our commitment to devel- will be using LUKOIL oils, greases greases that meet specific require- opment of highly efficient products,” and process fluids for servicing load- ments of the world’s leading original said OEM Cooperation Service chief ers, stackers and other special Toyota equipment manufacturers, including Rinat Kalmantayev. and BT warehouse machinery and Japanese OEMs, helped us offer opti- tools. mal solutions to #1 company in ma- The main product range of con- terial handling. In Russia, Toyota is tracted lubricants includes LUKOIL rightfully associated with high tech-

TMH is the global leader in manufacturing loading/offloading and ware- house machinery. Over the last 15 years, the Japanese company has firm- ly held the lead as the industry’s largest player. The Group manufac- tures its products at nine plants in Japan, Brazil, , China, U.S.A., and Sweden. The company produces machinery under Toyota, BT, Raymond, Cesab, Aichi and Tailift brands. TMH is part of Toyota Industries Corporation, which operates in automotive industry, industrial transport, electronics, logistics systems and textile equipment manufacturing.

10 COOPERATION COOPERATION

LUKOIL BEGINS COOPERATION WITH LIEBHERR IN RUSSIA

UKOIL has signed a contract to deliver service fill oil for Liebherr construction machinery serviced by the industrial giant’s region- Lal subsidiaries. The Company will offer Liebherr’s clients a wide range of modern oils and process fluids under the LUKOIL brand. Liebherr is Germany’s machine-building giant, which includes 130 companies all over the world. It has built the biggest pres- ence in construction machinery and refrigerating equipment sec- tors. In 2011, Liebherr opened a manufacturing plant in Dzerzhinsk, Nizhegorod region. It was the company’s first plant in Russia. The factory specializes in manufacturing steel frames for earth movers and tower cranes, as well as key components for flight control sys- tems in aviation industry. In Russia, Liebherr also produces aviation accessories and owns a repair and storage facility in the Odintsovo district, Moscow region.

lifting and other machinery operating NEW APPROVALS, FIRST FILL at oil temperatures that range from -35 С to +80 С. GEYSER UNIVERSAL DEAL WITH PALFINGER can replace AU and MGE-46V oils, tra- ditionally used in the summer, as well as VMGZ oil in winter months. n 2015, Palfinger approved hydrau- is LUKOIL’s know-how. Experts have Moreover, improved antioxidant, lic oils under LUKOIL GEYSER and noted that this is the optimal prod- antiwear, viscous, corrosion-resistant, ITEBOIL HYDRAULIC brands. The uct for the central part of Russia and low-temperature and antifoam pro- approvals enabled LUKOIL to en- countries with a moderate climate. perties enable the product to prevent ter a group of potential suppliers to The oil is recommended for all-season oil oxidation, wear and scuffing up Palfinger plants and CRANE Center use in hydraulic drive and control sys- to 40 percent better than MGE-46V, KAMAZ, a joint venture between tems of construction, road, forestry, VMGZ and AU oils. Palfinger and KAMAZ. The lead- ing lifting equipment manufactur- er’s experts highly valued our prod- ucts, and selected LUKOIL GEYSER UNIVERSAL hydraulic oil for first fill of Palfinger and Velmash-S lifting cranes and manipulators produced at the plant in Velikie Luki. Production of GEYSER UNIVERSAL (ISO VG 22) was launched in 2015. The all-season hydraulic oil with unique viscosity and temperature proper- ties, produced on Group III+ base oils,

LUKOIL LUBRICANTS | July 2017 11 PRODUCT ULTRA QUALITY FOR AGRICULTURAL SECTOR

RUSSIA’S AGRICULTURAL SECTOR IS ONE OF THE MOST PROMISING SEGMENTS FOR DEVELOPMENT OF LUKOIL’S LUBRICANTS BUSINESS. PAVEL KOLOMIETS, TECHNICAL ASSISTANCE DEPT. SPECIALIST AND THE OVERSEER OF AGRICULTURAL BUSINESS LINE SPEAKS ABOUT ADVANCED SOLUTIONS LUKOIL IS OFFERING TO FARMERS.

n recent years, LUKOIL has been 15W‑40 motor oil was used on growing steadily its presence in John Deere tractors, resulting in the lubricants market for agricul- an increase of the oil drain inter- ACCORDING TO PAVEL tural industry. Today, the com- val up to 350 engine hours, and sur- KOLOMIETS, LUKOIL PAYS pany’s important advantage is its passing the threshold set by the client A GREAT DEAL OF ATTENTION Iability to offer clients not just high by 40 percent. TO AGRICULTURAL MACHINERY quality lubricants that meet interna- The cost of an engine hour PRODUCERS’ DEMANDS tional standards, but an integrated dropped by approximately 60 percent services program, which helps opti- whereas the was compa- mize machinery performance. rable with the price tag of LUKOIL’s last year’s harvest, and the client A vivid example is the integrat- chief competitor! Another exam- was offered LUKOIL AVANTGARDE ed services program that was carried ple of optimized machinery perfor- ULTRA M3 15W‑40 engine oil for com- out last year at one of Russia’s larg- mance was the implementation of bines. The seasonal timeframe for est agricultural companies, Miratorg. the same program at Mordovsky be- harvest is rather narrow, and success LUKOIL’s AVANTGARDE ULTRA kon company. It took place during depends on a number of factors, in-

12 PRODUCT cluding weather. That is why excess evitable. It is telling that a single com- double or triple mileage runs occur bine harvester in Russia covers an ar- quite often. By using AVANTGARDE ea of 354 hectares, while in the United ULTRA M3 15W‑40, the client was able States it works over only 63 hectares! to increase the oil drain interval to GOST specification oils aren’t ready 700–750 engine hours and stop wor- for such workloads, their „evolution- rying about potential financial losses ary development“ in terms of today’s caused by machinery breakdowns. market demands has virtually been Jointly with PROMEXPORT, one stopped. of our leading dealers, we conduct- In an effort to “feel the pulse” of ed tests of AVANTGARDE ULTRA M3 our target audience, we launched a engine oil on the Akros 590 combine series of special conferences named made by Rostselmash. Over 508 en- “LUKOIL Lubricants for Modern gine hours of monitored operations, Agricultural Machinery,” which gath- the product maintained a high level of er managers and engineers of agricul- viscosity, and its performance prop- tural companies. The first forum was erties were practically comparable to held in Perm in 2014, the second one sue with our colleagues from the OEM those of new oil. Had it been needed, in Volgograd in mid-February 2017. Cooperation Dept. and concluded AVANTGARDE ULTRA M3 would have Consequently, several agricultural that the properties of AVANTGARDE run for declared 750 engine hours, holdings began the programs of mon- ULTRA and ULTRA М3 oils match re- but it wasn’t necessary since the har- vesting campaign ended on the 508th hour of monitoring. One of the product’s advantag- WE SHALL CONTINUE TO IMPROVE THE QUALITY es is that it “forgives the mistakes” OF LUKOIL LUBRICANTS: caused by episodic use of low quality CUSTOMERS VALUE THEIR RELIABILITY AND EFFICIENCY fuel, and reliably protects the engine. Agricultural workers also appreci- ate the possibility to mix the product with another oil. The AVANTGARDE itored use of our oils. We plan to hold quired parameters. The future be- ULTRA product line meets these re- the conference each year as it pro- longs to such products, and we shall quirements, and up to 12 percent of vides an excellent platform for expe- continue to improve the quality of the product can be mixed on condi- rience sharing. LUKOIL lubricants: customers value tion the other oil has the same level LUKOIL pays a great deal of atten- their reliability and efficiency, where- of performance properties according tion to agricultural machinery pro- as our well-balanced pricing policy to API, ACEA, and the same viscosi- ducers’ demands, such as the max- spurs growth of their popularity. ty grade. In the case of AVANTGARDE imum use of horsepower capacity, ULTRA, this has been confirmed by reduction of fleet ownership costs, successful laboratory and field tests. improvement of performance in- LUKOIL AVANTGARDE ULTRA М3 One of the acute problems in the dicators of agricultural work effi- AND LUKOIL VERSO UTTO ARE industry is the use of low quality ciency. This year, the Yaroslavl en- THE ADVANCED PRODUCTS oil, which can cost customers much gine plant launched production of IN THE COMPANY’S PRODUCT LINE more during the machinery’s opera- YAMZ 530 medium class engines for FOR THE AGRICULTURAL SECTOR tion. It is pleasant to know that mod- tractors, grain and for- ern machinery manufacturers such as age harvesters. Technical -based MTZ and Gomselmash, specifications were draft- which account for 74.6 percent of ed by Rostselmash and Russia’s tractor imports, recommend St. Petersburg tractor in their manuals high quality lubri- plants, both of which tar- cants with the latest specifications as get export deliveries the primary choice of oil, i. e. LUKOIL to European countries. AVANTGARDE product line, whose According to specifica- properties are considerably better tions, it was also neces- than those of GOST specification oils. sary to observe Stage IIIа A gradual phase-out of lubricants environmental require- with low quality specifications is in- ments. We studied this is-

LUKOIL LUBRICANTS | July 2017 13 PRO PROFILE STEFAN CLAUSSEN, LUKOIL MARINE LUBRICANTS TECHNICAL AND MARKETING DIRECTOR, SPEAKS ABOUT HIS SAILS, HIS CAREER AND LML’S METEORIC RISE IN THE GLOBAL MARINE LUBES BUSINESS MARINE IN ALL HE DOES!

was born in the north- Marine’s strategy team, in 2009 I decided it was time to ern German city of move on. Marne, located 12 kilo- In July 2009, I became technical and marketing director meters to the west of of LUKOIL Marine Lubricants, and was one of its founding Kiel Canal. My father members with Jan Thiedeitz, COO in Hamburg, and Viktor Iused to sail in the sea, and Zhuravsky, CEO based in St. Petersburg. We started the many locals worked in the marine business unit from scratch and we built it step by marine industry. So when step guided by a vision “... we stand for reliable service and I finished high school, I high quality products. We aim to become the first choice of decided to enroll in a two- our customers” and created the slogan MARINE IN ALL WE year program for ship me- DO! Actually, in the beginning it felt more like “we have to chanics. do all in marine” since we were only a small group and had After completing my apprenticeship at Germany’s mar- to deal with the entire order to cash process ourselves. itime shipping giant Hapag-Lloyd I continued as an offi- The confidence and the blind trust among the leader- cer’s assistant on a ship. At the time, Hapag-Lloyd was in- ship team and the support from LUKOIL enabled that en- troducing multi-purpose crews, and I got to work both trepreneurial climate. Our task was already challenging so in the engine room and on the bridge. Later on, as I was I didn’t really feel the pressure of performance and time, building my career in the marine business, that experience and that fueled creativity. would also prove very valuable in terms of helping me un- derstand the clients’ needs and expectations. I chose to pursue a degree in Marine Operating Technology at the Flensburg University of Applied OUR FUTURE SUCCESS RESTS ON AN EXCELLENT Sciences. I finished my studies with honors and went back GLOBAL TEAM THAT IS VERY EXPERIENCED, to sea. I wasn’t interested so much in seeing other coun- SELF-MOTIVATED AND UNDERSTANDS tries, I was more attracted by the technical aspect of seago- CUSTOMERS’ NEEDS ing. Aboard a ship it feels like being in a little city — it has its own freshwater generation, a sewerage plant, power generation, main propulsion, air conditioning, and so on. At the end of 1998, I took a job as technical coordina- Beginnings were tough as the industry fought the af- tor with BP Marine in Hamburg. Later, I joined the glob- termath of the global economic crisis. However, we also al Technical Marketing Team, provided strategic techni- saw this as an opportunity — had everything been fine, it cal support in terms of products, services and trainings and would have been a lot more difficult to convince a German was involved in product field-testing activities and OEM shipowner to try out a Russian oil. Moreover, our old busi- contacts. However, the BP/Castrol merger triggered anoth- ness connections played a part — many industry executives er reorganization and it became obvious that there was no already knew us and trusted us, and that made the market- possibility for me to grow further in BP’s marine business ing of LUKOIL marine lubes easier. Step by step, we were in the foreseeable future. expanding our customer base, and today LUKOIL owns That is why I decided to switch to sales and became key more than 12 percent of the global market. account manager for Castrol Marine in Northern Germany, One of the key contributors in making that achieve- Switzerland and Cyprus. Despite having a very good track ment was the development of our NAVIGO 100 MCL ma- record of performance and becoming part of Castrol rine oil. In 2010, nearly all container ships were using slow

14 PRO PROFILE steaming, which meant the vessels sailed at speeds significantly lower than their normal speed in order to save money on fuel. Due to lower op- erating temperatures the level of cor- rosive wear increased significantly on some engines running on 70 BN cyl- inder oil. We anticipated that future engine designs, which would aim to optimize fuel economy and to low- er emissions, would have higher cor- rosion levels. While our competitors started doing trials on 60 BN prod- ucts, we went in the opposite direc- tion. It was quite obvious to me that LLK-NAFTAN’S ADDITIVES FOR MARINE LUBRICANTS PROVIDE AN ADDITIONAL the only way to solve this, rather than COMPETITIVE ADVANTAGE FOR LUKOIL putting more oil, was to increase the concentration. With that in mind, we started field trials for NAVIGO cation system, which became an ture, most demanding engines and 100 MCL — a 100 BN cylinder oil, and instant hit with our clients. vessels equipped with exhaust gas achieved success. The breakthrough Today, the marine industry is fac- treatment systems. occurred in the summer of 2013 when ing a big challenge. In 2020, the new Our future success rests on an MAN, which earlier hadn’t been very global cap on sulfur content in heavy excellent global team that is very enthusiastic about our proposal, de- fuel will be reduced to 0.50% m/m experienced, self-motivated and cided to change its cylinder oil recom- from the current 3.50% m/m. We are understands customers’ needs. We mendation from 70 BN to 100 BN for confident that the launch of our new have built lasting personal relation- all new engines. Almost overnight, we NAVIGO MCL Extra will offer clients ships with our clients, and are able became the technology leader and the the best possible lubricant solutions to offer high quality products and only company offering 100 BN cyl- for the years leading up to 2020 and service. We are flexible, committed, inder oil globally. It reached a point beyond. It is an all-new 40 BN marine ready to listen and adapt to clients’ where marketing worked by word cylinder oil for distillate, ultra-low needs rather than do everything by of mouth: a LUKOIL customer would sulfur fuel oil (<0.1%S) and low sul- the book. LUKOIL has broken into talk to a non-LUKOIL customer, and fur heavy fuel oil applications. Also, the fold of top five marine lubricant he would praise the performance of we plan to launch NAVIGO 140 MCL, companies in the world, and I am op- NAVIGO 100 MCL, virtually acting as a new 140 BN cylinder oil, which en- timistic that we could soon overtake our brand ambassador! Later, we built ables even more flexibility and can our closest competitor and become on that success and developed iCOl- be used with iCOlube to further opti- the fourth-largest lubes company on ube, the intelligent cylinder oil lubri- mize lubrication of the latest and fu- the globe.

QUEEN MARY 2, THE WORLD’S LARGEST OCEAN LINER, IS ONE OF THE LANDMARK SHIPS THAT RUN ON LUKOIL MARINE OIL

LUKOIL LUBRICANTS | July 2017 15 COOPERATION

UKOIL is dynamically develop- ing its lubricants business in the LPersian Gulf countries and Asia. In May, the heads of the largest distrib- utors and dealers in Bahrain, Kuwait, Oman, U.A.E., Qatar, Bangladesh and Singapore paid a visit to LUKOIL’s plant in Perm, where they were able to witness the high standards of qual- ity control applied in the process of LUKOIL lubricants’ manufacturing. Put into operation in 2008, the facility in Perm is one of LUKOIL’s key manufacturing plants. It pro- duces up to 40,000 tons of lubri- cants per month, and is Europe’s EASTERN GROWTH OF DEMAND DEALERS TOUR IS A MATTER OF TIME PERM FACILITY

largest producer of packaged lubri- “It was an excellent visit. We of- cants. The in-mould labeling tech- ten tell our distributor partners nology was first applied here, even- that LUKOIL is the most dynam- tually providing reliable protection ic brand in terms of deveploment. from fake cans. During the tour, the Today, they were able to see in per- delegation visited the main process son how this brand is being created. facilities. At the compounding line, the visitors saw the process of au- tomated blending of lubricant com- “We work in many countries of the ponents and additives. In the labo- THE PERM PLANT IS EUROPE’S Middle East and we sold around ratory, LUKOIL staff demonstrated LARGEST PRODUCER 1 million liters of LUKOIL lubri- quality control of a finished prod- OF PACKAGED LUBRICANTS cants in our first year of cooper- uct that included identifying the ation with the Russian manufac- grade of purity, viscosity grade, turer,” said delegation member pour point, and other parameters. Atul Kumar, general director At the end of the demonstration, They assessed the scope of LUKOIL’s of Nissan’s dealer in Oman. “Of the visitors received conformity operations and high results that the course, many oil brands have been certificates, which accompany each Company has achieved over the pe- present in the Middle Eastern batch of Perm-produced lubricants. riod of 25 years. Our region is char- market for decades, but I think During the visit, the delega- acterized by top rate cars and the that a high demand for LUKOIL lu- tion also went on a plant tour, visit- trust we have in LUKOIL lubri- bricants is only a matter of time. ed the museum and took part in the cants testifies to the fact that the In Perm, we want to learn as much conference that featured LUKOIL Perm plant manufactures high-lev- as we can about LUKOIL, so we can specialists speaking about the com- el products in global terms,” said then introduce the core values of pany’s history, structure and plans LUKOIL Marine Lubricants DMCC this brand to our buyers.” for global development. sales director William Gilbert.

16 COOPERATION ACHIEVEMENT JUNE MANOHARAN IS THE WOMAN MARITIME PERSONALITY OF THE YEAR!

une Manoharan, LUKOIL Marine Lubricants regional direc- tor in Asia, Africa and the Middle East, has been named the J“Woman Maritime Personality of the Year.” The awards cere- mony was held on May 16 at ShipTek 2017, the international con- ference on marine, offshore and oil and gas industry. Manoharan has been working for LUKOIL Marine Lubricants, the company involved in production and sales of marine lubri- cants, since 2010. Over a seven-year period, she has made a sig- nificant contribution to development of LUKOIL’s lubricants business. Among her numerous achievements, she oversaw the founding of LUKOIL’s Dubai subsidiary, which eventually be- came LUKOIL Marine Lubricants’ head office.

GENESIS MOTOR OIL SALES LAUNCHED IN U.A.E.

LUKOIL has started sales of its LUKOIL GENESIS premium synthetic motor oil in the United Arab Emirates. The oil is marketed by the regional partner, Al Habtoor Motors LLC distributor company. “We see large potential for growth in the Middle Eastern market. In order to succeed here in the premium segment, we need to have a product portfolio that meets interna- tional car manufacturers’ latest requirements. One such highly efficient product is LUKOIL GENESIS oil, which we began to produce in Dubai,” said LUKOIL Lubricants Company gen- eral director Maxim Donde. LUKOIL GENESIS meets the requirements and is approved by the key European, American, Japanese and Korean car manufacturers, and is also compliant with API and ACEA international standards. This product line ensures higher engine protection and longer oil drain intervals. Since the beginning of LUKOIL’s cooperation with Al Habtoor Motors in 2015, the Russian company’s share in the U.A.E. lubricants market has reached 2 percent, in Qatar it grew to 7 percent, in Bahrain and Oman to 3 percent, in Kuwait to 2 percent. Over the next three years, the Company plans to double its shares in these markets.

LUKOIL LUBRICANTS | July 2017 17 FORUM

VOLGOGRAD HOSTS MINING INDUSTRY BUSINESS FORUM

IN VOLGOGRAD, RUSSIA’S LEADING GREASES main needs. The intent was to create MANUFACTURER INTESMO HOSTED THE 1ST INTERNATIONAL a communication platform for ex- perts in different fields of the mining BUSINESS FORUM “MINING INDUSTRY AND INNOVATIVE industry, so they could share experi- LUBRICANT SOLUTIONS” ence, information on new develop- ments, solutions, and jointly search for ideas that aim to boost efficiency, optimize technology process, imple- he hospitable Volga Hall con- Volgograd wasn’t selected acci- ment modern innovative, energy- ference center provided the dentally to host the event. In recent efficient, environment-friendly tech- platform for discussion and years, this city in southern Russia nologies, methods and materials. The networking for over 60 invit- has become one of LUKOIL’s cen- event facilitated a vibrant partners’ ed representatives of leading ters for R&D and manufacturing of dialogue that enabled them to see Tmining companies, equipment man- new products. Russia’s largest plastic new opportunities for expanding co- ufacturers, and LUKOIL’s lubricants greases manufacturing facility, the operation,” INTESMO general direc- experts. INTESMO plant, is located here, as is tor Kirill Vereta said. The conference panel featured the Engineering Center, which de- The participant list featured Yuri Plakitkin, Russia’s prominent velops and tests greases for different such companies as BELAZ, ALROSA, fuel and energy expert, and the dep- industries, including the mining in- SUEK, Arkhangelskgeoldobycha, uty director of the Energy Research dustry. Kuzbassrazrezugol, Evrokhim, Catoca, Institute at the Russian Academy of “The idea to gather representa- Raspadskaya Coal Company, Russian Sciences, as well as representatives tives of mining companies at one Copper Company, SDS Ugol, Stroiservis of service companies, developers of venue and organize this forum and others. Many of them have already technology solutions, grease systems, emerged in 2016 as demand soared partnered with LUKOIL and are inter- and special-purpose equipment, such for the FLEX greases product line, ested in implementing the Company’s as Noria, SKF, Lincoln and others. which meets the mining industry’s most advanced solutions.

18 FORUM “I liked the event program very much,” said Alexei Varyukhin, head of SUEK’s Procurement Dept. “The speeches delivered by distinguished experts in Russia’s energy strategy offered participants a chance to see the development curve of the coal industry and Russia’s energy sec- tor in general. Meanwhile, lubri- cants specialists demonstrated how proper use of oils and greases helps make the operations of coal compa- nies more efficient. Before the start of our partnership with LUKOIL we hadn’t used the opportunities to sub- stitute imports with domestic prod- ucts. However, since 2012 we have been successfully using the wide range of LUKOIL oils, and this year we launched the tests of INTESMO THE 1ST INTERNATIONAL BUSINESS FORUM “MINING INDUSTRY AND INNOVATIVE greases in our quarry machinery.” LUBRICANT SOLUTIONS” GATHERED REPRESENTATIVES OF LEADING MINING Mikhail Rak, BELAZ deputy chief COMPANIES, EQUIPMENT MANUFACTURERS, AND LUKOIL’S LUBRICANT EXPERTS constructor and head of its Testing and Operations Dept., noted the con- ference’s practical format. “This was portant to know how mining indus- ticipants could witness that during an excellent opportunity for business try customers ‘breathe’, what BELAZ their tour of LUKOIL’s manufactur- communication between equipment trucks they specifically use and under ing facilities in Volgograd. The per- manufacturers, lubricant produc- which conditions they opt to use dif- formance of INTESMO’s own R&D ers and vehicle buyers. For us it is im- ferent types of LUKOIL oils,” Rak said. center shows that LUKOIL contin- On the last day of the forum, the ues to move forward and improve

DURING THE FORUM, THE DELEGATES VISITED THE INTESMO GREASES PLANT AND LUKOIL’S LUBRICANT MANUFACTURING FACILITY IN VOLGOGRAD

delegates visited the INTESMO greas- the quality of its products. As a ma- es plant and LUKOIL’s lubricant man- jor buyer of modern quarry machin- ufacturing facility in Volgograd. ery we shall by all means negotiate INTESMO’s Engineering Center at- with leading foreign original equip- tracted a great deal of attention, in ment manufacturers the testing no small part due to its testing equip- of LUKOIL’s new oils and greases,” ment, which is absolutely unique in Arkhangelskgeoldobycha Technical Russia. Support Dept. head Sergei Topchy “High manufacturing cul- shared his impressions. ture is the calling card of LUKOIL The Volgograd conference Group’s companies. The forum par- demonstrated that the industry play- ers’ interest in LUKOIL’s innovation products is rising. INTESMO plans to INTESMO GENERAL DIRECTOR hold regularly similar business gath- KIRILL VERETA erings in its pursuit of new opportu- GREETS THE PARTICIPANTS nities for increasing the mining com- OF THE VOLGOGRAD FORUM panies’ production efficiency.

LUKOIL LUBRICANTS | July 2017 19 INTERNATIONAL BUSINESS

WE BUILD PRESENCE, ENTER NEW EUROPEAN MARKETS

WITH NEARLY TWO DECADES IN VARIOUS JOBS AT THE LOBAU PLANT, KARIN BAUMANN WAS A PERFECT FIT FOR LUKOIL WHEN THE RUSSIAN OIL GIANT TOOK OVER OMV’S CHIEF LUBRICANTS ASSET THREE YEARS AGO. TODAY, AS LUKOIL LUBRICANTS EUROPE’S PRODUCT MANAGER, HER JOB IS TO MAKE SURE THAT LUKOIL’S PRODUCT PORTFOLIO PROVIDES AN ADEQUATE RESPONSE TO CUSTOMER PREFERENCES AND NEEDS AS THE COMPANY EXPANDS ITS BUSINESS IN CENTRAL AND WESTERN EUROPE.

aumann, a chemical engi- At the time of the Lobau plant’s would still be entitled to use the neer by training with a Ph.D takeover by LUKOIL, Baumann was OMV brand and market OMV prod- in electrochemistry, entered in charge of R&D, quality control ucts. During that period, all paper- the downstream industry and technical support. As she says, work issued to existing customers in 1991. LUKOIL needed experienced staff to carried both brand names, so they B“My first job was with Castrol in set up the business under the new could adapt to the change and ulti- , I was involved in product LUKOIL brand. In most cases, includ- mately embrace the LUKOIL brand. development of biodegradable flu- ing her own, the responsibilities and By that time, the manufactur- ids,” she says. “When OMV planned to working conditions of former OMV ing of OMV products at Lobau had build a new blending plant in Lobau, employees remained more or less the stopped, so the stocked green-and- it needed new quality control labora- same. The only thing that changed blue OMV drums were gradually re- tories and in 1996 I joined OMV, tak- was the outlook. placed by LUKOIL’s red-and-white ing over quality control. Over the “We were now in a lubricants ones (and black-and-gold ones in the years I held several other jobs in ad- company instead of being just a little case of LUKOIL GENESIS engine oil). dition to my main one, I worked in tiny part of an integrated oil compa- According to the Company’s market- quality control, quality management, ny where our asset had the role of lit- ing strategy, LUKOIL GENESIS is its stood in for the plant manager, pro- tle significance,” Baumann explains. tier brand. The three horses offer a vided technical services, but every- The transition was a multi-stage unique selling proposition in the oil thing I did always evolved around lu- affair. The two companies agreed industry. It perfectly fits the slogan: bricants.” that over a 1.5-year period LUKOIL PASSION — PERFORMANCE — FUN.

20 INTERNATIONAL BUSINESS However, from the very out- ed locally under the LUKOIL set Baumann and her co-work- TM‑4 and TM‑5 brand names ers were also involved in continu- whose meaning is perfect- ous exchange of information with ly clear to domestic consum- their Moscow-based colleagues at ers. “In Europe, no one knows the company’s corporate headquar- these names since this is pure- ters. Approximately six months be- ly Russian certification. That fore the rights to the OMV brand ex- is why we eventually agreed pired, both sides worked intensively to keep OMV’s old BSX exten- to prepare the relaunch of the en- sion for transmission oil, and tire product line under the LUKOIL use TRANSMISSION as the key brand while maintaining the quality word. That’s how we arrived of product performance. at the LUKOIL TRANSMISSION “Going through our product lines, SYNTH BSX name in the end,” KARIN BAUMANN, we needed to decide on a case-by- explains Baumann. LUKOIL LUBRICANTS EUROPE case basis which name would be suit- A similar solution was found in PRODUCT MANAGER able for the European market, and the case of engine oil. OMV used to which wouldn’t,” says Baumann. produce the OMV BIXXOL SPECIAL In most cases, OMV and LUKOIL series, while in Russia LUKOIL’s A big success story in coopera- portfolios carried similar products premium engine oil brand was the tion with OEMs is the first fill deal meaning the old could easily be re- GENESIS series. Both names were fol- LUKOIL has struck with a major placed with the new. In some oth- lowed by extensions and viscosity German automotive brand. It in- er instances, though, the match was grades. cluded a major audit of the Lobau plant, and the deal provided a rap- id start into the OEM business for the Austrian facility. Other OEM proj- IN CREATING LUKOIL’S EUROPEAN PORTFOLIO, THE ULTIMATE GOAL ects are on the way, and the plant in WAS TO HONOR THE LONGTIME CUSTOMERS’ REQUEST NOT TO MISS Lobau has become a significant part ANYTHING FROM THE OLD OMV PORTFOLIO in implementing LUKOIL’s expansion strategy in the OEM business. Also popular in the European market are LUKOIL’s industrial lubri- medium or minor and it sometimes Today, LUKOIL Lubricants cants. According to Baumann, at the required developing a new LUKOIL Europe’s business is split approx- time when the Lobau plant was part product. One such example is the gas imately 50–50 between its key of OMV’s oil refinery, she and engine oil, which was missing in the Austrian market and the for- her colleagues had a firsthand oppor- LUKOIL portfolio, and a new product eign markets such as Germany, tunity to study the demand for lubri- named EFFORSE 4004 was eventually Czech Republic, Slovakia, Hungary, cants at an industrial facility. developed to fill the void. “In creat- Switzerland and Italy. The main “We were developing numerous ing LUKOIL’s European portfolio, the goals are to maintain strong pres- tailor-made products for specific ap- ultimate goal was to honor the long- ence at home, boost its market share plications, fine-tuned to the needs time customers’ request not to miss in Germany and further develop of specific machines,” she adds. “This anything from the old OMV portfo- LUKOIL’s business in Italy, which is portfolio may not be very attractive, lio,” says Baumann. a new market for the Austrian divi- but it is also very valuable since these The process of product lines’ har- sion, “inherited” from LUKOIL and are specific applications, and in ma- monization was difficult, she adds, put under the Vienna office’s respon- ny cases you can tie the customer because of different types of naming sibility during the takeover. to the lubricant supplier. If he deals for Russian and European markets. “Currently, the most attractive with a critical issue your product can In some cases, Russian names were product in our portfolio is the pas- solve, he will stay with it because kept despite sounding strange a little senger car engine oil range under any switch of product or supplier bit in Europe, while in others a joint the LUKOIL GENESIS brand. We try could cause difficulties in his opera- decision was made to keep some part to keep up to date with the latest re- tions. One of such sensitive products of OMV’s old brand name, and fit it quirements of OEMs,” adds Baumann. is turbine oil, which our big indus- into the new name. “They frequently change them, issue trial customers have remained loyal For example, LUKOIL in Russia new demands regarding certifica- to even after we changed its name to produces transmission oil market- tions and approvals.” TORNADO following the takeover.”

LUKOIL LUBRICANTS | July 2017 21 PRO PROFILE

IN THE BUSINESS SO COMPLEX AND DEMANDING AS OURS, MANY OF OUR EMPLOYEES HOLD JOBS THAT MEET KEEP THEM OUT OF THE LIMELIGHT DESPITE MAKING EXCELLENT CONTRIBUTIONS TO LUKOIL’S OVERALL SUCCESS. WHILE STAYING IN THE SHADOW, THEY STILL HELP US TAKE GIANT STEPS AS WE GROW OUR BUSINESS MATTHIAS GLOBALLY. IN THIS ISSUE, WE WOULD LIKE YOU TO MEET MATTHIAS MARGL, PRODUCT SAFETY MANAGER AT LUKOIL LUBRICANTS EUROPE, THE MAN WHO SUCCESSFULLY HANDLES THE TASK OF MAKING OUR MARGL PRODUCTS COMPLIANT WITH EUROPEAN AND GLOBAL SAFETY STANDARDS.

ly privately-funded research organization. Within four years, he rose from project member to project leader and mastered the fundamentals of lubrication science. “There I learnt my first lessons about tribology, lubri- cants, wear, friction. It was quite a unique research center offering a specific interdisciplinary blend of machinery and chemistry knowledge,” remembers Matthias. The main focus of the project he led was the analy- sis of industrial and automotive lubricants. The client was OMV, the former owner of LUKOIL’s plant in the Vienna suburb of Lobau. According to Margl, he was oversee- ing approximately 65,000 analyses of lubricants. In 2013, he was hired by OMV, and a year later, following the lo- cal plant’s acquisition by the Russian oil giant, he joined LUKOIL becoming the first member of its team in the Austrian capital. The new beginning posed a lot of challenges, but Margl handled them with grace. Today, he is in charge of the company’s product safety management for Central, Western and Eastern Europe, and last summer the Vienna office launched cooperation with its Moscow-based par- ent company, LUKOIL Lubricants Company. “In the beginning, it was quite tough. I already knew a lot about lubricants, but product safety is a specific area, a mix between chemistry and law. Essentially, it was a ‘one- man show,’ I had to learn most of the things on my own, and that made the job very hard, but I managed to suc- ceed,” adds Margl. argl, 36, earned his degree in chemistry In Berlin, he took several training courses, but they at Higher Federal Institute of Chemistry/ were very short and couldn’t quite match the complexi- Vienna majoring in chemistry for indus- ty of his work. “The hardest was the classification of sub- try and environmental technology. Prior stances. In 2015, the new CLP (Classification, Labeling and to entering the lubricants industry he had Packaging) legislation came into force in Europe. What Mworked as field manager in the construction business, su- made it even harder was the fact that product safety man- pervising soil contamination at Vienna’s main railway agers in other companies were not familiar with this leg- station. He quit that job in 2009 and started working for islation, too, so I was completely alone, and had nobody to the Austrian Competence Center for Tribology, a main- ask,” he explains.

22 PRO PROFILE The main focus in Margl’s job is the creation of material safety da- ta sheets (MSDS) confirming that the company’s products comply with the latest industry standards in terms of safety and current legislation. Keeping them up to date is very im- portant since some other aspects of the business such as product labeling, for instance, also depend on timely updates of relevant information. “There is a section in an MSDS quarters of the company and we are that carries information, which has to happy to be an important part of it,” be printed on the label of the finished he says. Moreover, the Vienna office THE BIGGEST product. So if my MSDS isn’t ready, recently issued its first ever MSDS we can’t print labels, launch sales and for a Russian-made product, LUKOIL CHALLENGE reach the market,” explains Margl. SN-2500 base oil, paving the way for According to him, the pace of cre- continued cooperation in terms of The part I love the most about ation of MSDS’s depends on the type creating data sheets for lubricants my job is responding to chal- of used additives. On a daily basis, produced at LUKOIL’s Russian plants. lenges, fixing problems. The big- Margl theoretically produces from 5 As he makes sure an MSDS is gest challenge so far was the to 8 safety data sheets for 32 legisla- properly created and legally compli- Relaunch Project two years ago. tion and language areas, which brings ant, Margl has to keep in mind nu- In spring 2015, we were required the tally to approximately 250 sheets merous issues such as potential dan- to generate safety data sheets for per day. Last year, LUKOIL Lubricants ger to workers’ health, availability all products in the new LUKOIL Europe produced a total of over 5,000 of appropriate storage facilities, etc. portfolio. As a result, around updated and new MSDS’s. Classifying a product as “dangerous 300 data sheets had to be creat- ed and translated within a very short time. With translations, this amounted to several thousand THE MAIN FOCUS IN MARGL’S JOB IS THE CREATION OF MATERIAL safety data sheets. The SAP/PSOD SAFETY DATA SHEETS (MSDS) CONFIRMING THAT THE COMPANY’S program had not yet been ful- PRODUCTS COMPLY WITH THE LATEST INDUSTRY STANDARDS ly configured for the new LUKOIL IN TERMS OF SAFETY AND CURRENT LEGISLATION products and the pressure from the sales department was very high. The fact that the new legis- lation (CLP under GHS) came into Another important aspect of goods” triggers extra costs and re- force at the time was also aggra- Margl’s job is the monitoring of safe- quires additional safety measures. vating. The Relaunch Project was ty-related legislative changes. There “You need a specific driver for the the biggest challenge in my life are several communication channels truck, a specific tank for storage and so far, it was very exhausting but that help him keep up to date, such transport, and so on,” he explains. also very exciting. Ultimately, it as the web portals of local chambers The challenges also include sensi- was a success! of commerce and industry, as well as tive environmental issues. The next step was sending our the SAP system, which automatically “As you might know, Germany MSDS inventory (300 products for updates relevant changes. The quick- has specific legislation regarding wa- 30 jurisdictions, 9,000 MSDS’s) to ness of reaction is highly important, ter endangering. Sometimes I do our customers according to cur- and Margl is happy with the kind of MSDS for LUKOIL products to be sold rent legislation. For this, we de- feedback he’s getting from Moscow. in the German market, and I have to veloped the automated MSDS- “The cooperation with our parent determine the water endangering shipping process for our location company has been highly efficient. I class, too. The results are comparable in Vienna. Thus, the correct MSDS appreciate it very much, we maintain to European results, we fully com- is automatically sent to our cus- contact every two days, exchange ply with local environmental regula- tomers via the EHS (Environment, opinions, and I am glad that we have tions. LUKOIL products fit quite good Health and Safety) system from opened this new channel, which is in terms of meeting environmental SAP. This shipping process runs very important since this is the head- regulations,” concludes Margl. automatically overnight, daily.

LUKOIL LUBRICANTS | July 2017 23 EXHIBITION GETTING CLOSER TO MEXICO

rior to launching the Company’s to the Company. LUKOIL plans to operation in the Latin American build on its successful track record Pmarket, the team of our ex- of lubricants’ supply to car plants in perts took part in an automotive Russia and Europe, making a switch trade show in Mexico. The Expo- from local deliveries to global coop- Provedores de Transporte exhibi- eration projects with automakers. tion that was held in May, gathered The Mexican market is one of in Monterrey providers of transpor- top-priority areas for expansion tation technology and services. It fea- of LUKOIL’s lubricants business. Its tured more than 300 exhibitors, in- key advantages include geograph- cluding car manufacturers, spare ical proximity and the free trade parts and components producers, as zone with the United States, as well well as Mexico’s key transportation as the immediate access to other companies. markets in Latin America. Besides “Over the last year, LUKOIL has this, Mexico boasts one of the most held a series of important negoti- ations with different market play- bricants for commercial vehicles and ers in Mexico. Our appearance at the industry. By the way, the LUKOIL Monterrey show provided another AVANTGARDE product line of en- THE LUKOIL AVANTGARDE opportunity to make sure we’re on gine oil for commercial vehicles PRODUCT LINE OF ENGINE the same page with potential clients sparked a special interest among OIL FOR COMMERCIAL and future partners,” stressed Mexico the show participants. LUKOIL lu- VEHICLES SPARKED A SPECIAL project office leader and LUKOIL del- bricants have been approved and INTEREST AMONG THE SHOW egation member Dmitry Golovin. recommended by all Mexico-based PARTICIPANTS LUKOIL intends to start opera- original equipment manufactur- tions in Mexico by promoting its lu- ers, providing a weighty advantage

dynamically developing economies FROM LEFT TO RIGHT: PROJECT LEADER DMITRY GOLOVIN, SENIOR MANAGER in the region. The world’s larg- FOR OEM COOPERATION ANTON SILIN, PRODUCT MANAGEMENT SERVICE est car producers such as General HEAD DMITRY PANFILOV, LUKOIL LUBRICANTS MEXICO S.R.L. DE C.V. GENERAL Motors, Ford, Chrysler, BMW, DIRECTOR ALEXEI BARANOV VW Group, Audi, Kia, Nissan, and Mercedes-Benz have factories in the country. According to an Ernst & Young estimate, Mexico is the sev- enth-largest car manufacturer on the globe. LUKOIL is already supplying ma- rine lubricants to nine major in- ternational ports in Mexico. The Company’s next step is to create a subsidiary for manufacturing and sales of automotive and industri- al lubricants — LUKOIL Lubricants Mexico S. R.L. de C.V. Currently, the subsidiary company is being regis- tered. It is expected to start opera- tions in the coming fall.

24 EXHIBITION Approvals/ Meets requirements of: CORPORATE AFFAIRS

• MB-Approval 228.5 • MAN M3277 • Volvo VDS-3 • Scania LDF-3 • Caterpillar ECF-2 • Cummins CES 20077/72 • Renault RLD-2, RXD • Ford WSS-M2C212-A1 • Deutz DQC IV-10, III-10 • MTU Category 3 • DAF Extended Drain • MACK EO-N, EO-M PLUS

API: CI-4, СF ACEA: E4/E7 SAE: 5W-30, 10W-40 “PERSPECTIVE 2017“ IS A TALENT DRAW

SYNTHETIC MOTOR OIL THE COMPANY’S EMPLOYEES ARE ITS MAIN ASSET. THANKS TO THE PEOPLE State Oil and Gas University entered WHO INVEST THEIR TIME, EFFORT AND CREATIVE ENERGY, THE COMPANY the project, and eventually got jobs in CAN CLAIM LEADERSHIP IN THE LUBRICANTS INDUSTRY. IN RECENT YEARS, the Company’s Economic and Finance LUKOIL HAS BEEN “BRINGING UP” FUTURE INDUSTRY PROFESSIONALS Dept. THROUGH THE PROGRAM OF HIRING UNIVERSITY GRADUATES WITH FIELD- “Since 2010, we have successful- LUKOIL AVANTGARDE SPECIFIC DEGREES AS PART OF OUR “PERSPECTIVE” PROJECT. ly carried out the ‘Perspective’ proj- ect. Each year, we are expanding its geographical reach. This year, we held PROFESSIONAL he program was launched and Belarus, and had passed a se- Company Days in Russia and CIS lead- seven years ago and has con- ries of difficult tests and interviews. ing universities, took part in sever- tinually proven to be ef- Consequently, 32 graduates became al vacancy fairs, career forums, grad- ficient. It is a pleasure to part of the LUKOIL team. Of those, 29 uates allocation days, the ChemCamp watch these young men and will be working at the head office of international student forum. These Twomen progress: having completed LUKOIL Lubricants Company, two will events yielded a total of around 1,000 multi-faceted corporate training pro- join INTESMO, and one will be hired filled-out student questionnaires. The grams and honed their practical in- by LUKOIL Lubricants Central Asia. most successful candidates will soon dustry skills, in a year or two many The majority of young specialists join our ranks. Our goal is to educate of them filled backup managerial po- received offers to work in the OEM tomorrow’s elite, the managers able sitions, and became project leaders Cooperation Dept., R&D division and to work at different levels, who are and section chiefs. commercial service. It should be noted deeply knowledgeable in their area of This year was marked by the big- that this was the first year when the expertise, and who strive to improve gest campaign so far in terms of hir- graduates of economic and finance personally and make the Company Extended oil change interval ing young talent. We selected the departments of the Higher School of better,” said LUKOIL Lubricants best candidates who represent- Economics and economic and finance Company HR and administrative is- ed 17 field-specific colleges in Russia department of the Gubkin Russian sues director Olga Proshutinskaya.

* Compared to ACEA E4 requirements ** Compared to ACEA E7 requirements *** Compared to ACEA E7 requirements LUKOIL@Lubricants | July 2017 25