Oil and Gas Industry Overview: Upstream, Midstream and Downstream - YouTube

Hello guys! Today we're going to take a look  at three main sectors of oil and gas industry.  

Hydrocarbons are extremely important in today's  world and are used not only as fuels but to create a  

large number of different petrochemicals  that we use on a daily basis such as  

plastics, polymers, fabrics,  cosmetics and even medicine.  

The oil gas industry is divided into three  main sectors: upstream, downstream, and midstream.  

Let's first start with upstream oil and  gas. Upstream on gas deals with the exploration  

and production of hydrocarbons. The exploration  stage often involves studying the geology of the  

formation and performing seismic surveys to  determine the best location to drill the well.  

Based on the survey data geoscientists determine  the potential of hydrocarbon reservoir underground.  

The wells can be drilled both onshore and offshore.  Usually, the offshore wells are more expensive  

and complicated. Before the well can be drilled  in addition to clearing the land for the lease  

some infrastructure needs to be built as well  like for example roads. On the new fields usually  

a couple of exploration wells are drilled first  to find out if there are actually hydrocarbons  

underground and it will find out the properties  of formation and how much hydrocarbons can be  

extracted. After the location for the producing  wells are determined the wells are drilled and  

casing is installed. Next casing is perforated and  usually hydraulic fracturing is performed to  

increase the production from the wells. After  fracturing the well often coiled tubing is used to  

clean up the wellbore and remove any obstructions  like for example bridge plugs that can restrict  

the flow of hydrocarbons in the well. The next step  is putting production surface equipment  

and facilities. Often there is a three-phase  separator as well to separate the well fluids into  

gas, oil, and water before the hydrocarbons are  transported to the refinery. During the life of  

the well various enhanced recovery methods are  used to increase the production from the wells.  

Some of those methods are water flooding,  chemical flooding and gas flooding as well  

and this is done to increase reservoir pressure  and increase the mobility of hydrocarbons

in the reservoir so that more oil can be pushed  into the well and then brought to surface.  

Oil and gas wells usually stay productive for many  years and then at the end of their lives those  

wells abandoned by placing a cement plug in the wellbore so that  

well fluid cannot flow to surface anymore.  The site where the wall was drilled is reclaimed  

by removing all the surface equipment. The  goal of the reclamation process is to bring the  

land where the well was drilled to the same  condition as it was before the well was drilled.  

This might involve planting new vegetation to  make the land look like there was nothing there. 

Examples of upstream oil and gas companies  are BP, Chevron, and Conoco Phillips. Now let's  

take a look at the midstream oil gas. Midstream  oil and gas deals with transportation and storage of  

hydrocarbons. After hydrocarbons are extracted from  the ground, they need to be transported to refining  

facility where they can be transformed into more  useful products. There are many ways to transport  

hydrocarbons to the refinery and some examples are  rail, pipelines, trucks, and tankers. Using pipelines  

is the most efficient way of transporting  hydrocarbons to the market because there is  

low risk of spill and the costs are usually  lower than transporting the hydrocarbons by  

rail or trucks. Initial investment requirements  to build the pipeline are usually pretty high  

and there are also a lot of regulations that make  the pipeline building process very slow. If oil 

needs to be transported over the ocean, usually  oil tankers are used. Tankers can also be used to  

transport liquefied natural gas or LNG but this  also requires compression-decompression terminals.  

Right now there is a trend towards  using natural gas instead of coal for producing  

electricity and this will likely drive the demand  for LNG. Examples of midstream companies are Trans  

Canada, Enbridge, and Kinder Morgan. Now let's take  a look at downstream oil and gas. Downstream oil  

gas deals with the refining of hydrocarbons usually  refining is performed by heating the crude oil  

to separate it into different hydrocarbons this  is possible because different hydrocarbons have  

different boiling temperatures. Another method  is called cracking and it's used to break down  

larger hydrocarbon molecules into smaller ones  more useful ones like for example gasoline.  

Common petroleum products are gasoline, solvents,  kerosene and various other petrochemicals that   

used by industry on daily basis. Large integrated  companies usually operate both in upstream  

and downstream sectors and some examples of  those companies are Husky, Chevron and Shell.  

So guys this is just a quick overview of  three main sectors of oil and gas industry  

and hopefully, this will give you some idea of how the oil  gas industry operates. If you guys found this video  

helpful please don't forget to  subscribe and I'll see you guys later!