How the Oil and Gas Industry Works

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Oil and gas

The petroleum industry can be divided into three parts. They can be upstream, midstream and downstream.
The upstream portion is also called the exploration and production sector. This includes searching for crude oil and natural gas underground or underwater through drilling. The drilling brings the crude oil and natural gas up to the surface for harvesting. Unconventional gas can sometimes be included in the upstream sector as well as liquefied natural gas. The upstream and oil and gas midstream sectors work together but rarely overlap. Most upstream oil and gas companies are called ‘integral’ because use all three sectors of upstream, midstream and downstream, combining them to work together.
The midstream portion refers to the transportation storage and marketing of crude or refined petroleum. Transportation is usually done by pipeline rail oil tanker or truck. These transport systems can be used to move the products and deliver the refined products to the downstream sector, which we will cover next. The oil and gas midstream operations usually include elements of the upstream and downstream sectors such as natural gas.
Lastly, the downstream portion includes the refining of petroleum crude oil as well as the processing of the natural gases. You can also include the marketing and distribution of the products which is where this partially overlaps with the oil and gas midstream operations. The downstream sector goes through products such as gasoline, kerosene, jet fuel, diesel, heating and fuel oils, and petrochemicals just to name a few.
Petroleum is crucial to so many industries and industrial civilization. We use 30 billion barrels of oil each year so the gas and oil industry is constantly having to evolve, grow and change to fit the needs of the world. Keeping up with oil production really is vital to the global processes of exploration, extraction and refining. Petroleum is oil and is the foundation of many chemical products such as pharmaceuticals, fertilizers, pesticides and plastics.
The cost of oil is trending downwards and this is not a good thing for the oil firms. Some will have to restructure their companies or even face liquidity crunches very soon. Although demand for labor is rising, the skilled workers have moved on to other fields or careers in fear of a repeat of the 2008 recession. Because of this, there is a severe lack of skilled workers in these industries.
Bringing it down to a more personal level, oil and gas touches the lives of every civilian, daily. It is more than 60% of the energy in our nation. Besides fueling cars, heating home and cooking food, oil and gas also help to generate electricity and even play a part in things you would never consider, such as dent resistant car fender or camping accessories.
As you can see, oil and gas or the petroleum industry, are crucial to helping the world run smoothly, effectively and efficiently. Don’t take for granted or waste what we have; be grateful and enjoy the world we live in.

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