Although the oil and gas industry is at the heart of the world economy, supplying much of the resources that literally power our world, the average consumer only sees a small part of the industry in operation. Within the oil and gas industry, experts divide the industry’s functions into three segments: upstream, midstream, and downstream.
Unless you’re a chemical engineer working on an ocean oil rig or a drill mechanic working on the Bakken Shale in North Dakota, the part of the industry that most directly touches your life is the downstream section of the petroleum industry. Even the smelly oil refineries you drive by on long road trips are part of the downstream industry, which mostly includes the refining and distribution of these vital energy products.
So how does the downstream oil industry work exactly?
How do fossil fuels in the ground turn into the gasoline you put in your car? When oil comes out of the ground, it’s in an unprocessed state and called crude oil. This crude oil is then transported to oil refineries located all over the world.
Crude oil contains a number of different types of molecules called hydrocarbons. These hydrocarbons all have different properties, and once separated can be turned into tons of useful products. In fact, we use the hydrocarbons found in crude oil to make things like engine oil, gasoline, plastic, tires, and even crayons. Even though there are many different types of hydrocarbons, they all have one thing in common: they store a LOT of energy.
So how is crude oil transformed into the products we use everyday? That’s where oil refineries come into play…
Once crude oil is transported to an oil refinery, it’s heated in furnaces and then fed into a machine known as a fractional distillation column. Inside the column, the different hyrdocarbons are pulled apart by the heating process, then siphoned off separately to be processed into various end products.
Of course, there are other steps in the refining process. Certain other types of chemicals must also be removed from crude oil before it can be sold in stores or turned into plastics or gasoline. So if you’ve ever wondered what happens at that oil refinery you drive by on the side of the road, now you know.
The downstream segment of the oil and gas industry may not seem as exciting to a lay person as an off-shore oil rig or a gigantic drill, but without an oil refinery, all that crude oil would be practically useless to the average consumer.