Environment

Going green in operations

Conservation of environment is a strong priority for Naftogaz of Ukraine and its subsidiaries. The Company is focused on mitigating the adverse impact on the environment and environmental risks in the course of its own production operations. Naftogaz's unified environmental policy is aimed at enabling effective environmental management of enterprises, implementation of leading environmental standards and application of best practices. Using our natural resources with care, including water and land, bringing down our waste generation, constant reduction of air emissions and water discharges, preserving biodiversity, and cutting down our energy consumption - these are the areas of our continuous improvement.

Total expenditures on environmental protection in 2020 amounted to UAH 162 million. In addition, Naftogaz Group made environment-related payments to the extent of UAH 65 million in 2020.

Upstream

Naftogaz has been implementing the latest approaches to well construction and hydrocarbon production. The fleet of drilling rigs, geophysical and mining equipment has been significantly upgraded. All field development projects have passed an environmental impact assessment procedure.

The process of developing a waste management program is underway as special attention is paid to this area. At present, a large part of the company's production facilities, in particular, drilling rigs located in environmentally vulnerable areas, use pitless drilling technology. It enables reduction in the use of land resources, mitigates the adverse environmental impact in the course of field development. Our scientists from UkrNDIgas are researching into prospects of using the dry residue of drill cuttings in other industrial areas as a secondary resource - for example, as construction materials for backfilling industrial roads, technical land reclamation at drilling sites, or re-layering of solid waste at landfills.

The Group companies use modern wastewater treatment technology. In line with the technological projects, concomitant fossil waters extracted along with hydrocarbons are returned to underground horizons through absorption wells. This method significantly mitigates the impact on surface water bodies, ground waters, partially restores the natural conditions of subsoil areas leased for hydrocarbon production.

Since 2019, Naftogaz has been actively increasing the introduction of mechanized production technology (plunger lift, capillary systems) in order to reduce gas losses during well blowing-out. In 2019, there were 10  such wells, in 2020 - 44, in 2021 - 90. In 2022, it is planned to upgrade about 230 wells. Such measures enable reduction in gas losses and greenhouse gas emissions during the blowing-out.

Midstream

Naftogaz of Ukraine represented by JSC Ukrtransgaz together with LLC "Operator of Gas Transmission System of Ukraine" are implementing a 10-year plan to modernize underground storage facilities and gas transportation system of of Ukraine in 2018-2027 in order to bring our production facilities in line with European standards of reliability, safety and environment in operation of compressor stations and gas transportation. In particular, we are planning the reconstruction of 4 compressor stations: Yahotyn, Dykanka, Romny and Bilche-Volytsia.

Downstream

During 2015-2020, the Shebelinsky Oil Refinery carried out the largest modernization in the last 20 years, making it possible to switch production into Euro 5 standard fuel exclusively under the Šhebel brand. In particular, the technical re-equipment of the catalytic reforming unit was carried out in order to reduce the benzene content in the commercial gasoline component. The construction of the diesel fuel hydrotreatment plant for catalytic purification of products from sulfur-, nitrogen- and oxygen-containing compounds has been completed, the diesel fuel dewaxing process has been introduced. As of 2021, the entire range of products produced at the refinery, namely Šhebel branded motor gasoline, diesel fuel, and liquefied gas fully complies with all European environmental standards.