Plans for the construction of a new oil refinery in its present location were approved by the
Council of Ministers of the Soviet Union on September 1, 1949, who also approved similar plans for new refineries in the cities of
Ufa,
Kuybyshev,
Orsk,
Gorky,
Grozny,
Ryazan,
Stalingrad and
Baku. An area of wasteland near the city of Molotov, which would change its name to Perm in 1958, was chosen for its strategic location near the
Trans-Siberian Railway and the Kama River. The refinery broke ground two years later in January 1951 and was designated as a shock construction project, with 900 members of
Komsomol arriving from the
North Caucasus to work on the site. The majority of construction works were completed by local workers, alongside prisoners from
gulags and foreign labor from
China. The initial phase of construction was completed seven years later, with production commencing at the new refinery in November 1958. By the end of 1958, the refinery was connected to a 448 km pipeline to
Almetyevsk in
Tatarstan, in addition to a 17 km
tram line linking the refinery to the center of the city of Perm. catalytic reformation units and facilities to produce
bitumen,
paraffin and low-sulfur fuels. Construction began on a new petrochemical plant at the complex in 1965, and over the next decade the refinery began producing various
petrochemicals, such as
ethylene,
propylene,
ethylbenzene and
butyl alcohols. By the fifteenth anniversary of the Perm refinery commencing operations, it was the sixth largest refinery by production in the Soviet Union. With the refinery now also producing significant quantities of
ammonia and
urea, As a result, the
state-owned enterprise controlling the Perm refinery had emerged as the largest in the Soviet Union by the early 1980s. At its peak in 1983, the refinery employed approximately 10,000 staff and produced 87 types of products. However, the refinery had begun to fall into decline by the end of the decade after it lost all state-funded
subsidies in 1987, and was forced to be financially self-sustaining for the first time in its history. Consequently, the leadership made changes to make production economically viable, such as processing crude to achieve a higher yield and developing additional refining processes at the site. All the facilities within the refinery complex had been rebuilt and modernized by the mid-2000s, including a new
coking plant and
vacuum distillation tower. As a result, Lukoil-Permnefteorgsintez significantly increased production of diesel and gasoline to 1.2 million tons annually without similarly increasing the volume of crude oil utilized in the refining process. As a result, diesel production at the Perm refinery equated to four million tons by the end of 2014. Following this increase, Lukoil considered reconstructing the Perm-Andreevka-Ufa pipeline, although this project has not yet materialized. In January 2016, over five thousand
railway wagons were transporting crude oil and refined petroleum to and from the refinery per month, according to
Russian Railways. Later that year, Sergey Andronov was appointed as the General Director of Lukoil-Permnefteorgsintez, a position he still holds as of 2025. Two years after his appointment, the
Ministry of Energy awarded the company a
Certificate of Honor in 2018 to commemorate sixty years since the refinery commenced operations and to recognize its contribution to the oil and gas industry in Perm Krai during that time. However, this award came during a period when operations at the refinery were routinely disrupted by major fires, with incidents reported in 2017, 2019 and 2021. By 2020, the Perm refinery had emerged as the most efficient in the Russian Federation, processing 99.2% of the crude oil it received into petroleum products. Additional investment into the facilities of the Perm refinery to improve efficiency further was announced in September 2020 as a part of a broader social and economic cooperation agreement signed by Lukoil and the then acting
Governor of Perm Krai,
Dmitry Makhonin. Similar proposals to build a
catalytic cracking complex were also announced in August 2021, although the project faced significant delays because of the
Russian invasion of Ukraine in February 2022 and did not commence until August 2025. During the war, the refinery has been subject to
attacks by long-range drones from Ukraine, but these attacks have to date been smaller in scope and number than the attacks faced by other refineries in Russia. This has been because of the significant distance between the Perm complex and Ukrainian-controlled territory. In March 2022, Lukoil-Permnefteorgsintez became one of the first companies to resume exports of liquefied petroleum gas to
Afghanistan after the
Taliban returned to power in August 2021. However, exports to other countries fell considerably because of the
sanctions imposed by the
European Union, the
United Kingdom and the
United States as a consequence of the Russian invasion earlier that year. Since July 2023, the company controlling the Perm refinery, Lukoil-Permnefteorgsintez, has been subject to sanctions by
Ukraine. Lukoil has denied that the Perm refinery produced 6,500 metric tons of
toluene, a key chemical used in the production of
TNT, for munitions factories in Russia following an investigation by
Reuters in 2024. ==See also==