McDermott International, Inc.) announced it has been awarded a significant* contract by LUKOIL NizhegorodNefteorgSyntez, a subsidiary of JSC LUKOIL, for the engineering, procurement and construction (EPC) of the Delayed Coker Unit for the Deep Conversion Complex planned to be built in Kstovo refinery, Russia.

This award follows a 2016 award to Chevron Lummus Global (CLG), McDermott's joint venture with Chevron, for its delayed coking technology, and highlights the significance of pull through opportunities that McDermott's Lummus Technology business offers other parts of the organization. In October 2017, McDermott was awarded a detailed engineering, procurement and long lead supply award contract for the project.

"Our ability to provide integrated, end-to-end solutions, from our industry-leading refining technology to a highly efficient project delivery model, has been a deciding factor in securing this win," said Tareq Kawash, McDermott's Senior Vice President for Europe, Africa, Russia and Caspian. "This is also significant for McDermott because it is the company's first downstream EPC project in the Russian Federation."

The contract will be reflected in McDermott's third quarter 2018 backlog.

Project Details

The delayed coking complex will be built at the 17 million-ton/year Kstovo refinery in central Russia's Nizhny Novgorod region. In addition to the delayed coker, the complex will include a diesel hydrotreater, gas fractionation unit, sulfur and hydrogen production units, and associated systems.

Alongside other planned optimization projects, the 2.1 million-tons/year delayed coking complex will improve the refinery's light product yield by more than 10 percent while reducing the fuel oil production by 2.7 million tons per year. The complex is scheduled for startup in 2021.

LUKOIL is one of the largest publicly traded, vertically integrated oil and gas companies in the world accounting for more than two percent of the world's oil production and around one percent of the proven hydrocarbon reserves.

*McDermott defines a significant contract as between USD $250 million and USD $500 million.

About McDermott

McDermott (NYSE: MDR is a premier, fully integrated provider of technology, engineering and construction solutions to the energy industry. For more than a century, customers have trusted McDermott to design and build end-to-end infrastructure and technology solutions—from the wellhead to the storage tank—to transport and transform oil and gas into the products the world needs today. Our proprietary technologies, integrated expertise and comprehensive solutions deliver certainty, innovation and added value to energy projects around the world. Customers rely on McDermott to deliver certainty to the most complex projects, from concept to commissioning. It is called the "One McDermott Way." Operating in over 54 countries, McDermott's locally focused and globally-integrated resources include approximately 40,000 employees and engineers, a diversified fleet of specialty marine construction vessels and fabrication facilities around the world. As used in this press release, McDermott includes McDermott International, Inc. and its subsidiaries and affiliates.

About LUKOIL

PJSC “LUKOIL” is one of the largest publicly traded, vertically integrated oil and gas companies in the world in terms of proved hydrocarbon reserves and production; and the second largest producer of crude oil in Russia. Established in 1991, the Company currently operates in more than 30 countries with core upstream assets located in Russia. The full production cycle includes oil and gas exploration, production and refining; production of petrochemicals and lubricants; power generation; marketing and distribution providing LUKOIL with maximum synergies from its activities. The Company’s shares are listed in Russia on Moscow Exchange under the ticker “LKOH” and depositary receipts are listed on the London Stock Exchange under the ticker “LKOD”.