Oil 101: Introduction to Oil and Gas - Upstream
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The document provides an overview of the upstream segment of the oil and gas industry, focusing on exploration and production (e&p) activities. It covers key processes like drilling and production, including the complexities of oilfield services, types of reserves, and unconventional resource extraction methods. Ekt Interactive is identified as a training company in the oil and gas sector, offering insights into the industry since 1986.
Oil 101: Introduction to Oil and Gas - Upstream
- 1. EKTINTERACTIVE.COM Oil 101: Introduction to Oil and Gas What is Upstream?
- 2. EKTINTERACTIVE.COM What Oil 101: Upstream Will Cover This Oil 101: Upstream module includes the following sections: Introduction to Upstream Upstream Business Characteristics Oilfield Services Reserves – Formation and Importance Production – The First Step in Adding Value The Unconventional Future of Upstream
- 3. EKTINTERACTIVE.COM Company Structure Most oil and gas companies are segmented and organized according to business segment, assets, or function.
- 4. EKTINTERACTIVE.COM Generally, this consists of: UPSTREAM MIDSTREAM DOWNSTREAM
- 5. EKTINTERACTIVE.COM Upstream = E&P The upstream segment of the business is also known as the exploration and production (E&P) sector.
- 6. EKTINTERACTIVE.COM E&P encompasses activities related to searching for, recovering and producing crude oil and natural gas.
- 7. EKTINTERACTIVE.COM It’s all about the WELLS.
- 8. EKTINTERACTIVE.COM Where to locate them, How deep and how far to drill them, How to design, construct, operate and manage them...
- 9. EKTINTERACTIVE.COM ...to deliver the greatest possible return on investment with the lightest, safest and smallest operational footprint.
- 10. EKTINTERACTIVE.COM Exploration The exploration sector involves obtaining a lease and permission to drill.
- 11. EKTINTERACTIVE.COM Drilling Drilling is physically creating the “borehole” in the ground that will eventually become an oil or gas well. This work is done by rig contractors and service companies in the Oilfield Services business sector.
- 12. EKTINTERACTIVE.COM Simple or Complex Wells can be drilled on land or in miles of water. They can be less than 100 feet (30 meters) deep and totally vertical, or 20,000 feet (6,000 meters) deep and horizontal.
- 13. EKTINTERACTIVE.COM Drilling There are even highly complex “J” and “S” configurations with numerous branches, or laterals, emanating from the original, or “mother”, hole.
- 14. EKTINTERACTIVE.COM Production The production sector of the upstream segment maximizes recovery of petroleum from subsurface reservoirs. Production brings the oil to the surface.
- 15. EKTINTERACTIVE.COM Production - Decline Curve The inevitable fact of every oil or gas field is that production will eventually decline. The question is how fast?
- 16. EKTINTERACTIVE.COM An ‘Unconventional’ Upstream Unconventional resources are considered by the petroleum industry to be any resources extracted, or produced, by any method other than the traditional vertically drilled well.
- 17. EKTINTERACTIVE.COM This includes horizontal drilling and hydraulic fracturing, or fracking.
- 18. EKTINTERACTIVE.COM Hydraulic Fracturing Hydraulic fracturing, or fracking, is the process of injecting water, chemicals, and sand into wells. The resulting fractures in surrounding rock formations allows for hydrocarbons to escape.
- 19. EKTINTERACTIVE.COM Deepwater Drilling Some of the largest oil and gas discoveries of the last decade have been found in deep water off the coasts of Africa and South America as well as the Gulf of Mexico.
- 21. EKTINTERACTIVE.COM Unbelievably Complex The upstream industry is arguably the most complex of all the oil and gas business sectors.
- 22. EKTINTERACTIVE.COM Who are the Players? Independents, Majors, NOCs, Oilfield Services
- 23. EKTINTERACTIVE.COM Independents The companies that focus solely on Exploration and Production are called Independents.
- 24. EKTINTERACTIVE.COM Independents are known for their ability to make decisions and move quicker than other industry participants. They are also considered early adopters of the more innovative drilling and production technologies.
- 25. EKTINTERACTIVE.COM Majors Major Oil Companies (also called Integrated Oil Companies – IOCs) also have assets in the downstream — the refineries and service stations that bring the products to the end-user customers.
- 26. EKTINTERACTIVE.COM These companies have the prominent and advertised brands that you are familiar with:
- 27. EKTINTERACTIVE.COM NOCs National Oil Companies (NOCs) are those industry participants that are owned and managed by governments around the world.
- 28. EKTINTERACTIVE.COM Oilfield Services What is the oilfield services sector?
- 29. EKTINTERACTIVE.COM Oilfield Service The Oilfield Services sector of the Upstream segment consists of companies that build the infrastructure and provide the specialized equipment.
- 30. EKTINTERACTIVE.COM The Oilfield Services industry provides the following support: Exploration services Drilling services Well completion Production services Offshore
- 31. EKTINTERACTIVE.COM Oilfield Services Oilfield services and supply companies do not typically produce oil and gas or own the assets that contain them.
- 32. EKTINTERACTIVE.COM Oilfield Services At a typical drilling well site, there could be 25-30 different oilfield service companies handling the mechanical, technical and analytic operations needed to successfully complete a well.
- 33. EKTINTERACTIVE.COM Oil Reserves Reserves, Reservoirs, Types of Crude Oil
- 34. EKTINTERACTIVE.COM Oil Reserves The vast amounts of crude oil and natural gas trapped underground are referred to as reserves.
- 35. EKTINTERACTIVE.COM Oil Reserves Proven reserves are the estimated quantities which geological and engineering data demonstrate can be recovered in future years from known reservoirs, assuming existing economic, technical and operating conditions.
- 36. EKTINTERACTIVE.COM Oil & Gas Reservoir Characteristics Oil and gas are not found in easy-to-access underground pools or puddles but, instead, are trapped in various rock formations and geological structures.
- 37. EKTINTERACTIVE.COM Oil & Gas Reservoir Characteristics There are four key types of geological formations needed to have oil and gas reserves in place
- 38. EKTINTERACTIVE.COM Source rock – where the oil or gas was formed
- 39. EKTINTERACTIVE.COM Reservoir – where oil or gas reside, having migrated through microscopic structures in the surrounding rock
- 40. EKTINTERACTIVE.COM Seal – which is impermeable and stops the migration of the oil and gas
- 41. EKTINTERACTIVE.COM Trap – which is the combination of the reservoirs and seals
- 43. EKTINTERACTIVE.COM Types of Crude Oil: Heavy, Light, Sweet, Sour
- 44. EKTINTERACTIVE.COM Types of Crude Oil There are hundreds of different grades of crude oil that come out of the ground. Most commonly, the crude will be described as light or heavy and sweet or sour.
- 46. EKTINTERACTIVE.COM There’s So Much More... This material was taken from our free Oil 101 course.
- 47. EKTINTERACTIVE.COM Who are we? EKT Interactive has been a leading oil and gas training company since 1986. Visit us at www.ektinteractive.com to learn more.