Petroleum industry

The petroleum industry, also known as the oil industry or the oil patch, includes the global processes of exploration, extraction, refining, transporting (often by oil tankers and pipelines), and marketing of petroleum products. The largest volume products of the industry are fuel oil and gasoline (petrol). Petroleum (oil) is also the raw material for many chemical products, including pharmaceuticals, solvents, fertilizers, pesticides, synthetic fragrances, and plastics. The extreme monetary value of oil and its products has led to it being known as "black gold". The industry is usually divided into three major components: upstream, midstream, and downstream.

Petroleum is vital to many industries, and is necessary for the maintenance of industrial civilization in its current configuration, making it a critical concern for many nations. Oil accounts for a large percentage of the world’s energy consumption, ranging from a low of 32% for Europe and Asia, to a high of 53% for the Middle East.

Other geographic regions' consumption patterns are as follows: South and Central America (44%), Africa (41%), and North America (40%). The world consumes 30 billion barrels (4.8 km³) of oil per year, with developed nations being the largest consumers. The United States consumed 25% of the oil produced in 2007.[1] The production, distribution, refining, and retailing of petroleum taken as a whole represents the world's largest industry in terms of dollar value.

Governments such as the United States government provide a heavy public subsidy to petroleum companies, with major tax breaks at virtually every stage of oil exploration and extraction, including the costs of oil field leases and drilling equipment.[2]

In recent years, enhanced oil recovery techniques — most notably multi-stage drilling and hydraulic fracturing ("fracking") — have moved to the forefront of the industry as this new technology plays a crucial and controversial role in new methods of oil extraction.[3]

Oil Reserves
World oil reserves, 2013.
Reservespie
The distribution of oil and gas reserves among the world's 50 largest oil companies. The reserves of the privately owned companies are grouped together. The oil produced by the "supermajor" companies accounts for less than 15% of the total world supply. Over 80% of the world's reserves of oil and natural gas are controlled by national oil companies. Of the world's 20 largest oil companies, 15 are state-owned oil companies.

History

Oil Field Baku 1926
Oil Field in Baku, Azerbaijan, 1926

Prehistory

Korna natural oil seep 1
Natural oil spring in Korňa, Slovakia.

Petroleum is a naturally occurring liquid found in rock formations. It consists of a complex mixture of hydrocarbons of various molecular weights, plus other organic compounds. It is generally accepted that oil is formed mostly from the carbon rich remains of ancient plankton after exposure to heat and pressure in Earth's crust over hundreds of millions of years. Over time, the decayed residue was covered by layers of mud and silt, sinking further down into Earth’s crust and preserved there between hot and pressured layers, gradually transforming into oil reservoirs.[4]

Early history

Petroleum in an unrefined state has been utilized by humans for over 5000 years. Oil in general has been used since early human history to keep fires ablaze and in warfare.

Its importance to the world economy however, evolved slowly, with whale oil being used for lighting in the 19th century and wood and coal used for heating and cooking well into the 20th century. Even though the Industrial Revolution generated an increasing need for energy, this was initially met mainly by coal, and from other sources including whale oil. However, when it was discovered that kerosene could be extracted from crude oil and used as a lighting and heating fuel, the demand for petroleum increased greatly, and by the early twentieth century had become the most valuable commodity traded on world markets.[5]

Modern history

Oil wells in Boryslav
Oil wells in Boryslav
Galicja1881
Galician oil wells
World Oil Production
World crude oil production from wells (excludes surface-mined oil, such as from Canadian heavy oil sands), 1930-2012
Top Oil Producing Countries
Top oil-producing countries
(million barrels per day)

Imperial Russia produced 3,500 tons of oil in 1825 and doubled its output by mid-century.[6] After oil drilling began in what is now Azerbaijan in 1846 in Baku, two large pipelines were built in the Russian Empire: the 833 km long pipeline to transport oil from the Caspian to the Black Sea port of Batum (Baku-Batum pipeline), completed in 1906, and the 162 km long pipeline to carry oil from Chechnya to the Caspian. Batum is renamed to Batumi in 1936.

At the turn of the 20th century, Imperial Russia's output of oil, almost entirely from the Apsheron Peninsula, accounted for half of the world's production and dominated international markets.[7] Nearly 200 small refineries operated in the suburbs of Baku by 1884.[8] As a side effect of these early developments, the Apsheron Peninsula emerged as the world's "oldest legacy of oil pollution and environmental negligence".[9] In 1846, Baku (Bibi-Heybat settlement) the first ever well drilled with percussion tools to a depth of 21 meters for oil exploration. In 1878, Ludvig Nobel and his Branobel company "revolutionized oil transport" by commissioning the first oil tanker and launching it on the Caspian Sea.[7]

Samuel Kier established America's first oil refinery in Pittsburgh on Seventh avenue near Grant Street, in 1853. One of the first modern oil refineries were built by Ignacy Łukasiewicz near Jasło (then in the dependent Kingdom of Galicia and Lodomeria in Central European Galicia), Poland in 1854–56.[10] These were initially small, as demand for refined fuel was limited. The refined products were used in artificial asphalt, machine oil and lubricants, in addition to Łukasiewicz's kerosene lamp. As kerosene lamps gained popularity, the refining industry grew in the area.

The first commercial oil well in Canada became operational in 1858 at Oil Springs, Ontario (then Canada West).[11] Businessman James Miller Williams dug several wells between 1855 and 1858 before discovering a rich reserve of oil four metres below ground.[12][13] Williams extracted 1.5 million litres of crude oil by 1860, refining much of it into kerosene lamp oil.[11] Some historians challenge Canada’s claim to North America’s first oil field, arguing that Pennsylvania’s famous Drake Well was the continent’s first. But there is evidence to support Williams, not least of which is that the Drake well did not come into production until August 28, 1859. The controversial point might be that Williams found oil above bedrock while Edwin Drake’s well located oil within a bedrock reservoir. The discovery at Oil Springs touched off an oil boom which brought hundreds of speculators and workers to the area. Canada's first gusher (flowing well) erupted on January 16, 1862, when local oil man John Shaw struck oil at 158 feet (48 m).[14] For a week the oil gushed unchecked at levels reported as high as 3,000 barrels per day.

The first modern oil drilling in the United States began in West Virginia and Pennsylvania in the 1850s. Edwin Drake's 1859 well near Titusville, Pennsylvania, is typically considered the first true modern oil well, and touched off a major boom.[15][16] In the first quarter of the 20th century, the United States overtook Russia as the world's largest oil producer. By the 1920s, oil fields had been established in many countries including Canada, Poland, Sweden, Ukraine, the United States, Peru and Venezuela.[16]

The first successful oil tanker, the Zoroaster, was built in 1878 in Sweden, designed by Ludvig Nobel. It operated from Baku to Astrakhan.[17] A number of new tanker designs were developed in the 1880s.

In the early 1930s the Texas Company developed the first mobile steel barges for drilling in the brackish coastal areas of the Gulf of Mexico. In 1937 Pure Oil Company (now part of Chevron Corporation) and its partner Superior Oil Company (now part of ExxonMobil Corporation) used a fixed platform to develop a field in 14 feet (4.3 m) of water, one mile (1.6 km) offshore of Calcasieu Parish, Louisiana. In early 1947 Superior Oil erected a drilling/production oil platform in 20 ft (6.1 m) of water some 18 miles off Vermilion Parish, Louisiana. It was Kerr-McGee Oil Industries (now Anadarko Petroleum Corporation), as operator for partners Phillips Petroleum (ConocoPhillips) and Stanolind Oil & Gas (BP), that completed its historic Ship Shoal Block 32 well in November 1947, months before Superior actually drilled a discovery from their Vermilion platform farther offshore. In any case, that made Kerr-McGee's Gulf of Mexico well, Kermac No. 16, the first oil discovery drilled out of sight of land.[18][19] Forty-four Gulf of Mexico exploratory wells discovered 11 oil and natural gas fields by the end of 1949.[20]

During World War II (1939–1945) – control of oil supply from Baku and Middle East played a huge role in the events of the war and the ultimate victory of the allies. Cutting off the oil supply considerably weakened Japan in the latter part of the war. After World War II ended, the countries of the Middle East took the lead in oil production from the United States. Important developments since World War II include deep-water drilling, the introduction of the Drillship, and the growth of a global shipping network for petroleum relying upon oil tankers and pipelines. In 1949, first offshore oil drilling at Oil Rocks (Neft Dashlari) in the Caspian Sea off Azerbaijan eventually resulted in a city built on pylons. In the 1960s and 1970s, multi-governmental organizations of oil–producing nations OPEC and OAPEC played a major role in setting petroleum prices and policy. Oil spills and their cleanup have become an issue of increasing political, environmental, and economic importance.

With the advent of hydraulic fracturing and other horizontal drilling techniques, shale play has seen an enormous uptick in production. Areas such as the Permian Basin and Eagle-Ford shales are now huge hotbeds of production for the largest oil corporations in the United States.[21]

Structure

042 Pancevo refinery, Serbia
NIS refinery in Pančevo, Serbia

The American Petroleum Institute divides the petroleum industry into five sectors:[22]

Upstream

Oil companies used to be classified by sales as "supermajors" (BP, Chevron, ExxonMobil, ConocoPhillips, Shell, Eni and Total S.A.), "majors", and "independents" or "jobbers". In recent years however, National Oil Companies (NOC, as opposed to IOC, International Oil Companies) have come to control the rights over the largest oil reserves; by this measure the top ten companies all are NOC. The following table shows the ten largest national oil companies ranked by reserves[23][24] and by production in 2012.[25]

Top 10 largest world oil companies by reserves and production
Rank Company (Reserves) Worldwide Liquids Reserves (109 bbl) Worldwide Natural Gas Reserves (1012 ft3) Total Reserves in Oil Equivalent Barrels (109 bbl) Company (Production) Output (Millions bbl/day)[1]
1 Saudi Arabia Saudi Aramco 260 254 303 Saudi Arabia Saudi Aramco 12.5
2 Iran NIOC 138 948 300 Iran NIOC 6.4
3 Qatar Qatar Petroleum 15 905 170 United States ExxonMobil 5.3
4 Iraq INOC 116 120 134 China PetroChina 4.4
5 Venezuela PDVSA 99 171 129 United Kingdom BP 4.1
6 United Arab Emirates ADNOC 92 199 126 Netherlands United Kingdom Royal Dutch Shell 3.9
7 Mexico Pemex 102 56 111 Mexico Pemex 3.6
8 Nigeria NNPC 36 184 68 United States Chevron 3.5
9 Libya NOC 41 50 50 Kuwait Kuwait Petroleum Corporation 3.2
10 Algeria Sonatrach 12 159 39 United Arab Emirates ADNOC 2.9
^1 : Total energy output, including natural gas (converted to bbl of oil) for companies producing both.

Most upstream work in the oil field or on an oil well is contracted out to drilling contractors and oil field service companies.[26]

Aside from the NOCs which dominate the Upstream sector, there are many international companies that have a market share. For example:[27]

Midstream

Midstream operations are sometimes classified within the downstream sector, but these operations compose a separate and discrete sector of the petroleum industry. Midstream operations and processes include the following:

  • Gathering: The gathering process employs narrow, low-pressure pipelines to connect oil- and gas-producing wells to larger, long-haul pipelines or processing facilities.[28]
  • Processing/refining: Processing and refining operations turn crude oil and gas into marketable products. In the case of crude oil, these products include heating oil, gasoline for use in vehicles, jet fuel, and diesel oil.[29] Oil refining processes include distillation, vacuum distillation, catalytic reforming, catalytic cracking, alkylation, isomerization and hydrotreating.[29] Natural gas processing includes compression; glycol dehydration; amine treating; separating the product into pipeline-quality natural gas and a stream of mixed natural gas liquids; and fractionation, which separates the stream of mixed natural gas liquids into its components. The fractionation process yields ethane, propane, butane, isobutane, and natural gasoline.
  • Transportation: Oil and gas are transported to processing facilities, and from there to end users, by pipeline, tanker/barge, truck, and rail. Pipelines are the most economical transportation method and are most suited to movement across longer distances, for example, across continents.[30] Tankers and barges are also employed for long-distance, often international transport. Rail and truck can also be used for longer distances but are most cost-effective for shorter routes.
  • Storage: Midstream service providers provide storage facilities at terminals throughout the oil and gas distribution systems. These facilities are most often located near refining and processing facilities and are connected to pipeline systems to facilitate shipment when product demand must be met. While petroleum products are held in storage tanks, natural gas tends to be stored in underground facilities, such as salt dome caverns and depleted reservoirs.
  • Technological applications: Midstream service providers apply technological solutions to improve efficiency during midstream processes. Technology can be used during compression of fuels to ease flow through pipelines; to better detect leaks in pipelines; and to automate communications for better pipeline and equipment monitoring.

While some upstream companies carry out certain midstream operations, the midstream sector is dominated by a number of companies that specialize in these services. Midstream companies include:

Environmental impact

Water pollution

Some petroleum industry operations have been responsible for water pollution through by-products of refining and oil spills. Though hydraulic fracturing has significantly increased natural gas extraction, there is some belief and evidence to support that consumable water has seen increased in methane contamination due to this gas extraction. [31] Leaks from underground tanks and abandoned refineries may also contaminate groundwater in surrounding areas. Hydrocarbons that comprise refined petroleum are resistant to biodegradation and have been found to remain present in contaminated soils for years. [32] To hasten this process, bioremediation of petroleum hydrocarbon pollutants is often employed by means of aerobic degradation. [33] More recently, other bioremediative methods have been explored such as phytoremediation and thermal remediation. [34][35]

Air pollution

The industry is the largest industrial source of emissions of volatile organic compounds (VOCs), a group of chemicals that contribute to the formation of ground-level ozone (smog).[36] The combustion of fossil fuels produces greenhouse gases and other air pollutants as by-products. Pollutants include nitrogen oxides, sulphur dioxide, volatile organic compounds and heavy metals.

Researchers have discovered that the petrochemical industry can produce ground-level ozone pollution at higher amounts in winter than in summer.[37].

Climate change

The greenhouse gases due to fossil fuels drive global warming. Already in 1959, at a symposium organised by the American Petroleum Institute for the centennial of the American oil industry, the physicist Edward Teller warned then of the danger of global climate change.[38] Edward Teller explained that carbon dioxide "in the atmosphere causes a greenhouse effect" and that burning more fossil fuels could "melt the icecap and submerge New York".[38]

The Intergovernmental Panel on Climate Change, founded by the United Nations in 1988, concludes that human-sourced greenhouse gases are responsible for most of the observed temperature increase since the middle of the twentieth century.

As a result of climate change concerns, many alternative energy enthusiasts have begun using other methods of energy such as solar and wind, among others. This recent view has some petroleum enthusiasts skeptic about the true future of the industry. [39]

Future shortages

As petroleum is a non-renewable natural resource the industry is faced with an inevitable eventual depletion of the world's oil supply. The BP Statistical Review of World Energy 2007 listed the reserve/production ratio for proven resources worldwide. This study indicated a ratio of proven reserves to production in the Middle East at 79.5 years, Latin America at 41.2 years and North America at 12 years. A misguided interpretation of the ratio has led to many false predictions of imminent world oil shortages since the early years of the oil industry in the 1800s. This has been especially true in the United States, where the ratio of proved reserves-to-production has been between 8 years and 17 years since 1920. Many have mistakenly interpreted the result as the number of years before the oil supply is exhausted. Such analyses do not take into account future reserves growth.[40]

The Hubbert peak theory, which introduced the concept of peak oil, questions the sustainability of oil production. It suggests that after a peak in oil production rates, a period of oil depletion will ensue. Since virtually all economic sectors rely heavily on petroleum, peak oil could lead to a partial or complete failure of markets.[41]

According to market research by IBISWorld, biofuels (primarily ethanol, but also biodiesel) will continue to supplement petroleum. However output levels are low, and these fuels will not displace local oil production. More than 90% of the ethanol used in the US is blended with gasoline to produce a 10% ethanol mix, lifting the oxygen content of the fuel.[42]

See also

Industry pioneers
Oil production
Financial and political
Environmental issues
Oil geology
Oil-producing areas
Industry Research Projects
Other articles
  • All pages with titles containing oil industry
  • All pages with titles containing petroleum industry
  • All pages with titles containing gas industry

Notes and references

  1. ^ The World Factbook. "Country Comparison - Oil Consumption". Found at https://www.cia.gov/library/publications/the-world-factbook/rankorder/2174rank.html
  2. ^ New York Times, 2010 July 3, "As Oil Industry Fights a Tax, It Reaps Subsidies," https://www.nytimes.com/2010/07/04/business/04bptax.html?_r=1
  3. ^ Boudet, Hilary; Clarke, Christopher; Bugden, Dylan; Maibach, Edward; Roser-Renouf, Connie; Leiserowitz, Anthony (2014-02-01). ""Fracking" controversy and communication: Using national survey data to understand public perceptions of hydraulic fracturing". Energy Policy. 65: 57–67. doi:10.1016/j.enpol.2013.10.017. ISSN 0301-4215.
  4. ^ Speight, James (2014-01-30). The Chemistry and Technology of Petroleum, Fifth Edition. Chemical Industries. CRC Press. doi:10.1201/b16559. ISBN 9781439873892.
  5. ^ Halliday, Fred. The Middle East in International Relations: Cambridge University Press: USA, p. 270
  6. ^ N.Y. Krylov, A.A. Bokserman, E.R.Stavrovsky. The Oil Industry of the Former Soviet Union. CRC Press, 1998. P. 187.
  7. ^ a b Shirin Akiner, Anne Aldis. The Caspian: Politics, Energy and Security. Routledge, 2004. P. 5.
  8. ^ United States Congress, Joint Economic Committee. The Former Soviet Union in Transition. M.E. Sharpe, 1993. P. 463.
  9. ^ Quoted from: Tatyana Saiko. Environmental Crises. Pearson Education, 2000. P. 223.
  10. ^ Frank, Alison Fleig (2005). Oil Empire: Visions of Prosperity in Austrian Galicia (Harvard Historical Studies). Harvard University Press. ISBN 978-0-674-01887-7.
  11. ^ a b "Black Gold: Canada's Oil Heritage". The Corporation of the County of Lambton. Archived from the original on 29 July 2013. Retrieved 30 July 2013. The North American oil industry began in Oil Springs in 1858 in less spectacular fashion. James Miller Williams, a coachmaker from Hamilton, dug into the tar-like gum beds of Enniskillen Township to find their source. At a depth of fourteen feet, he struck oil. Williams immediately built a small refinery and began to produce illuminating oil for lamps - kerosene. It was Williams who was able to take full advantage of the ancient resource. Not only was he astute enough to look below the surface of the gum beds to find oil and to realize its commercial potential, but the timing of his discovery was perfect.
  12. ^ Turnbull Elford, Jean. Canada West's Last Frontier. Lambton County Historical Society, 1982, p. 110
  13. ^ Sarnia Observer and Lambton Advertiser, "Important Discovery in the Township of Enniskillen Archived 2015-04-03 at the Wayback Machine," 5 August 1858, p. 2.
  14. ^ "Extraordinary Flowing Oil Well". Hamilton Times. 20 January 1862. p. 2. Archived from the original on 3 April 2015. Retrieved 30 July 2013. Our correspondent writes us from the Oil Springs, under date of the 16th inst., [an] interesting account of a flowing Oil well which has just been tapped. He says:— I have just time to mention that to-day at half past eleven o'clock, a.m., Mr. John Shaw, from Kingston, C. W., tapped a vein of oil in his well, at a depth of one hundred and fifty-eight feet in the rock, which filled the surface well, (forty-five feet to the rock) and the conductors [sic] in the course of fifteen minutes, and immediately commenced flowing. It will hardly be credited, but nevertheless such is the case, that the present enormous flow of oil cannot be estimated at less than two thousand barrels per day, (twenty-four hours), of pure oil, and the quantity increasing every hour. I saw three men in the course of one hour, fill fifty barrels from the flow of oil, which is running away in every direction; the flat presenting the appearance of a sea of oil. The excitement is intense, and hundreds are rushing from every quarter to see this extraordinary well. Experience oil well diggers from the other side, affirm that this week equals their best flowing wells in Pennsylvania, and they pronounced the oil as being of a superior quality. This flowing well is situation on lot No. 10, Range B, Messrs. Sanborn & Co.'s Oil Territory.
  15. ^ John Steele Gordon Archived 2008-04-20 at the Wayback Machine "10 Moments That Made American Business," American Heritage, February/March 2007.
  16. ^ a b Vassiliou, Marius (2018). Historical Dictionary of the Petroleum Industry, 2nd Ed. Lanham, MD: Rowman and Littlefield, 621 pp.
  17. ^ Tolf, Robert W. (1976). "4: The World's First Oil Tankers". The Russian Rockefellers: The Saga of the Nobel Family and the Russian Oil Industry. Hoover Press. ISBN 0-8179-6581-5. p. 55.
  18. ^ Ref accessed 02-12-89 by technical aspects and coast mapping. Kerr-McGee
  19. ^ "Project Redsand". www.project-redsand.com.
  20. ^ Wells, Bruce. "Offshore Petroleum History". American Oil & Gas Historical Society. Retrieved 11 November 2014.
  21. ^ Farah, Stanley, Rachel (2018-07-24). "Comparison of Two Active Hydrocarbon Production Regions in Texas to Determine Boomtown Growth and Development: A Geospatial Analysis of Active Well Locations and Demographic Changes, 2000-2017".
  22. ^ American Petroleum Institute. "Industry Sectors." http://www.api.org/aboutoilgas/sectors/ Retrieved 12 May 2008
  23. ^ Ranked in order of 2007 worldwide oil equivalent reserves as reported in "OGJ 200/100", Oil & Gas Journal, September 15, 2008. http://www.petrostrategies.org/Links/Worlds_Largest_Oil_and_Gas_Companies_Sites.htm
  24. ^ "The Role of National Oil Companies in the International Oil Market" (PDF). Congressional Research Service. August 2007. Retrieved 2009-09-17.Ranking by oil reserves and production, 2006 values
  25. ^ "The World's 25 Biggest Oil Companies" (2012). Forbes
  26. ^ Chima, Christopher M. (7 February 2011). "Supply-Chain Management Issues In The Oil And Gas Industry". Journal of Business & Economics Research (JBER). 5 (6). doi:10.19030/jber.v5i6.2552.
  27. ^ International Association of oil and Gas Producers "Archived copy". Archived from the original on 2013-11-22. Retrieved 2013-11-04.CS1 maint: Archived copy as title (link)
  28. ^ "The Transportation of Natural Gas," Archived 2011-01-01 at the Wayback Machine NaturalGas.org, Retrieved December 14, 2012.
  29. ^ a b "Refining and Product Specifications Module Overview," Petroleum Online, Retrieved December 14, 2012.
  30. ^ Trench, Cheryl J., "How Pipelines Make the Oil Market Work – Their Networks, Operation and Regulation," Archived 2013-12-28 at the Wayback Machine Allegro Energy Group, December 2001.
  31. ^ Osborn, Stephen G.; Vengosh, Avner; Warner, Nathaniel R.; Jackson, Robert B. (2011-05-17). "Methane contamination of drinking water accompanying gas-well drilling and hydraulic fracturing". Proceedings of the National Academy of Sciences. 108 (20): 8172–8176. Bibcode:2011PNAS..108.8172O. doi:10.1073/pnas.1100682108. ISSN 0027-8424. PMC 3100993. PMID 21555547.
  32. ^ Diphare, Motshumi., Muzenda, Edison., Remediation of Contaminated Soils: A Review. Intl' Conf. on Chemical, Integrated Waste Management & Environmental Engineering (ICCIWEE'2014) April 15-16, 2014 Johannesburg.
  33. ^ M D Yuniati 2018 IOP Conf. Ser.: Earth Environ. Sci. 118 012063
  34. ^ Liu, Rui., Jadeja, N. Rajendrasinh., Zhou, Qixing., Liu, Zhe. Treatment and Remediation of Petroleum-Contaminated Soils Using Selective Ornament Plants. Environmental Engineering Sci. 2012 Jun; 29(6): 494–501.
  35. ^ Lim, Wei Mei., Lau, Von Ee., Poh, Eong Phaik. A comprehensive guide of remediation technologies for oil contaminated soil — Present works and future directions. Marine Pollution Bulletin. Volume 109, Issue 1, 15 August 2016, Pages 14-45.
  36. ^ http://www.epa.gov/airquality/oilandgas/basic.html
  37. ^ Zamora, Robert; Yuan, Bin; Young, Cora J.; Wild, Robert J.; Warneke, Carsten; Washenfelder, Rebecca A.; Veres, Patrick R.; Tsai, Catalina; Trainer, Michael K.; Thompson, Chelsea R.; Sweeney, Colm; Stutz, Jochen; Soltis, Jeffrey; Senff, Christoph J.; Parrish, David D.; Murphy, Shane M.; Stuart A. McKeen; Li, Shao-Meng; Li, Rui; Lerner, Brian M.; Lefer, Barry L.; Langford, Andrew O.; Koss, Abigail; Helmig, Detlev; Graus, Martin; Gilman, Jessica B.; Flynn, James H.; Field, Robert A.; Dubé, William P.; deGouw, Joost A.; Banta, Robert M.; Ahmadov, Ravan; Roberts, James M.; Brown, Steven S.; Edwards, Peter M. (1 October 2014). "High winter ozone pollution from carbonyl photolysis in an oil and gas basin". Nature. 514 (7522): 351–354. Bibcode:2014Natur.514..351E. doi:10.1038/nature13767. PMID 25274311 – via www.nature.com.
  38. ^ a b Benjamin Franta, "On its 100th birthday in 1959, Edward Teller warned the oil industry about global warming", The Guardian, 1 January 2018 (page visited on 2 January 2018).
  39. ^ Martín, Mariano, ed. (2016). Alternative Energy Sources and Technologies. doi:10.1007/978-3-319-28752-2. ISBN 978-3-319-28750-8.
  40. ^ Deffeyes, Kenneth S. (2001). Hubbert's Peak: The Impending World Oil Shortage. Princeton University press. pp. 1–13. Archived from the original on 2010-07-03.
  41. ^ "German Military Braces for Scarcity After ‘Peak Oil’". The New York Times. September 9, 2010.
  42. ^ IBISWorld. "US Oil Drilling Industry Market Research Report." http://www.ibisworld.com/industry/retail.aspx?indid=103&chid=10 Retrieved 14 May 2008

Further reading

  • Mau, Mark; Edmundson, Henry (2015). Groundbreakers: the Story of Oilfield Technology and the People Who Made It Happen. UK: FastPrint. ISBN 978-178456-187-1.
  • Nevins, Alan. John D. Rockefeller The Heroic Age Of American Enterprise (1940); 710pp; favorable scholarly biography; online
  • Ordons Oil & Gas Information & News
  • Robert Sobel The Money Manias: The Eras of Great Speculation in America, 1770–1970 (1973) reprinted (2000).
  • Daniel Yergin, The Prize: The Epic Quest for Oil, Money, and Power, (Simon and Schuster 1991; paperback, 1993), ISBN 0-671-79932-0.
  • Matthew R. Simmons, Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy, John Wiley & Sons, 2005, ISBN 0-471-73876-X.
  • Matthew Yeomans, Oil: Anatomy of an Industry (New Press, 2004), ISBN 1-56584-885-3.
  • Smith, GO (1920): Where the World Gets Its Oil: National Geographic, February 1920, pp 181–202
  • Marius Vassiliou, Historical Dictionary of the Petroleum Industry, 2nd Ed.. Lanham, MD: Rowman & Littlefield, 2018, 621 pp. ISBN 978-1-5381-1159-8.
  • Ronald W. Ferrier; J. H. Bamberg (1982). The History of the British Petroleum Company: Volume 1, The Developing Years, 1901-1932. Cambridge UP. pp. A–13. ISBN 9780521246477.
  • Miryusif Mirbabayev, Concise History of Azerbaijani Oil. Baku, Azerneshr, (2008), 340pp.
  • Miryusif Mirbabayev, Brief history of the first drilled oil well; and the people involved - Oil-Industry History (USA), 2017, v.18, #1, p.25-34.

External links

Downstream (petroleum industry)

The oil and gas industry is usually divided into three major sectors: upstream, midstream, and downstream. The downstream sector is the refining of petroleum crude oil and the processing and purifying of raw natural gas, as well as the marketing and distribution of products derived from crude oil and natural gas. The downstream sector reaches consumers through products such as gasoline or petrol, kerosene, jet fuel, diesel oil, heating oil, fuel oils, lubricants, waxes, asphalt, natural gas, and liquefied petroleum gas (LPG) as well as hundreds of petrochemicals.

Midstream operations are often included in the downstream category and are considered to be a part of the downstream sector.

Economy of Bahrain

Bahrain has an open economy. The Bahraini currency is the second-highest-valued currency unit in the world. Since the late 20th century, Bahrain has heavily invested in the banking and tourism sectors. The country's capital, Manama is home to many large financial structures. Bahrain's finance industry is very successful. In 2008, Bahrain was named the world's fastest growing financial center by the City of London's Global Financial Centres Index. Bahrain's banking and financial services sector, particularly Islamic banking, have benefited from the regional boom driven by demand for oil. Petroleum production is Bahrain's most exported product, accounting for 60% of export receipts, 70% of government revenues, and 11% of GDP. Aluminium production is the second most exported product, followed by finance and construction materials.According to the 2011 Index of Economic Freedom, Bahrain has the freest economy in the Middle East and North Africa region [1] and is the tenth freest economy in the world. An alternative index, published by the Fraser Institute, puts Bahrain in 44th place tied with 7 other countries. Bahrain was recognised by the World Bank as a high income economy.

Economy of Libya

The Economy of Libya depends primarily upon revenues from the petroleum sector, which represents over 95% of export earnings and 60% of GDP. These oil revenues and a small population have given Libya one of the highest nominal per capita GDP in Africa.After 2000, Libya recorded favourable growth rates with an estimated 10.6% growth of GDP in 2010. This development was interrupted by the Libyan Civil War, which resulted in contraction of the economy by 62.1% in 2011. After the war the economy rebounded by 104.5% in 2012, but then crashed again following the Second Libyan Civil War. As of 2017, Libya's per capita PPP GDP stands at 60% of its pre-wars level.

Economy of Qatar

Qatar's economy is one of the richest economies in the world based on GDP per capita, ranking between fifth and seventh on world rankings for 2015 and 2016 data compiled by the World Bank, United Nations, and IMF.Petroleum and natural gas are the cornerstones of Qatar's economy and account for more than 70% of total government revenue, more than 60% of gross domestic product, and roughly 85% of export earnings. Qatar has the world's third largest proven natural gas reserve and is the second-largest exporter of natural gas.

Environmental impact of the petroleum industry

Petroleum is one of the main sources of energy in the World. Petroleum and its by-products are used to fuel various forms of transportation, industry and domestic electricity use. Petroleum is also used to manufacture plastics which provides products essential for daily life. Also, petroleum has helped create many products like cosmetics, tyres (rubber) pesticides etc. Over the years there have been increased concerns over the environmental effects of the petroleum industry. The environmental impacts of petroleum are mainly negative. This is due to the toxicity of petroleum which contributes to air pollution, acid rain, and various illnesses in humans. Petroleum also fuels climate change, due to the increased greenhouse gas emissions in its extraction, refinement, transport and consumption phases.

Fuel extraction in Pakistan

According to the United States Energy Information Administration (EIA), Pakistan may have over 9 billion barrels (1.4×109 cubic metres) of petroleum oil and 105 trillion cubic feet (3.0 trillion cubic metres) in natural gas (including shale gas) reserves.As per BP' Statistical Review of World Energy 2016, at the end of 2015 Pakistan had the following proved reserves of fuels: 0.5 Trillion cu m of natural gas and 2.07 Billion tons of coal (sub-bituminous and lignite).

History of the oil industry in Saudi Arabia

Saudi Arabian oil was first discovered by the Americans in commercial quantities at Dammam oil well No. 7 in 1938 in what is now modern day Dhahran.

History of the petroleum industry

The petroleum industry is not of recent origin, but petroleum's current status as the key component of politics, society, and technology has its roots in the early 20th century. The invention of the internal combustion engine was the major influence in the rise in the importance of petroleum.

Midstream

The oil and gas industry is usually divided into three major components: upstream, midstream and downstream. The midstream sector involves the transportation (by pipeline, rail, barge, oil tanker or truck), storage, and wholesale marketing of crude or refined petroleum products. Pipelines and other transport systems can be used to move crude oil from production sites to refineries and deliver the various refined products to downstream distributors. Natural gas pipeline networks aggregate gas from natural gas purification plants and deliver it to downstream customers, such as local utilities.

The midstream operations are often taken to include some elements of the upstream and downstream sectors. For example, the midstream sector may include natural gas processing plants that purify the raw natural gas as well as removing and producing elemental sulfur and natural gas liquids (NGL) as finished end-products.

Niger Coast Protectorate

The Niger Coast Protectorate was a British protectorate in the Oil Rivers area of present-day Nigeria, originally established as the Oil Rivers Protectorate in 1884 and confirmed at the Berlin Conference the following year. It was renamed on 12 May 1893, and merged with the chartered territories of the Royal Niger Company on 1 January 1900 to form the Southern Nigeria Protectorate.

Oil reserves in Ghana

The petroleum industry of Ghana is regulated by the state-owned Ghana National Petroleum Corporation (GNPC) and administered by the state-owned Ghana Oil Company (GOIL).

Petroleum industry in China

The impact of the petroleum industry in China has been increasing globally as China is the fourth-greatest oil producer in the world.China imported a record 6.7m barrels a day (b/d) of oil in 2015 and forecasted "to overtake the U.S. as the world’s biggest crude importer in 2016" According to the Energy Information Administration (EIA) China first became the "world's largest net importer of petroleum and other liquids" by the end of 2013.

Petroleum industry in Iran

For the economic effects refer to Economy of Iran.

Iran is an energy superpower and the Petroleum industry in Iran plays an important part in it. In 2004 Iran produced 5.1 percent of the world's total crude oil (3.9 million barrels (620,000 m3) per day), which generated revenues of US$25 billion to US$30 billion and was the country's primary source of foreign currency. At 2006 levels of production, oil proceeds represented about 18.7 percent of gross domestic product (GDP). However, the importance of the hydrocarbon sector to Iran's economy has been far greater. The oil and gas industry has been the engine of economic growth, directly affecting public development projects, the government's annual budget, and most foreign exchange sources.In FY 2009, the sector accounted for 60 percent of total government revenues and 80 percent of the total annual value of both exports and foreign currency earnings. Oil and gas revenues are affected by the value of crude oil on the international market. It has been estimated that at the Organization of the Petroleum Exporting Countries (OPEC) quota level (December 2004), a one-dollar change in the price of crude oil on the international market would alter Iran's oil revenues by US$1 billion.In 2012, Iran, which exports around 1.5 million barrels of crude oil a day, was the second-largest exporter among the Organization of Petroleum Exporting Countries. In the same year, officials in Iran estimated that Iran's annual oil and gas revenues could reach $250 billion by 2015. However, the industry was disrupted by an international embargo from July 2012 through January 2016. Iran plans to invest a total of $500 billion in the oil sector before 2025.

Petroleum industry in Iraq

Iraq was the world's 12th largest oil producer in 2009, and has the world's fifth largest proven petroleum reserves after Venezuela, Saudi Arabia, Canada, and Iran. Just a fraction of Iraq's known fields are in development, and Iraq may be one of the few places left where vast reserves, proven and unknown, have barely been exploited. Iraq's energy sector is heavily based upon oil, with approximately 94 percent of its energy needs met with petroleum. In addition, crude oil export revenues accounted for over two-thirds of GDP in 2009. Iraq's oil sector has suffered over the past several decades from sanctions and wars, and its oil infrastructure is in need of modernization and investment. As of June 30, 2010, the United States had allocated US$2.05 billion to the Iraqi oil and gas sector to begin this modernization, but ended its direct involvement as of the first quarter of 2008. According to reports by various U.S. government agencies, multilateral institutions and other international organizations, long-term Iraq reconstruction costs could reach US$100bn or higher.

Petroleum industry in Russia

The petroleum industry in Russia is one of the largest in the world. Russia has the largest reserves and is the largest exporter of natural gas. It has the second largest coal reserves, the eighth largest oil reserves, and is one of the largest producers of oil. It is the third largest energy user.Russia produced an average of 10.83 million barrels (1,722,000 m3) of oil per day in December 2015. It produces 12% of the world's oil and has a similar share of global oil exports. In June 2006, Russian crude oil and condensate production reached the post-Soviet maximum of 9.7 million barrels (1,540,000 m3) per day. Exceeding production in 2000 by 3.2 Mbbl/d (510,000 m3/d). Russian exports consist of more than 5 Mbbl/d (790,000 m3/d) of oil and nearly 2 Mbbl/d (320,000 m3/d) of refined products, which go mainly to the European market. The domestic demand in 2005 was 2.6 Mbbl/d (410,000 m3/d) on average. It is also the main transit country for oil from Kazakhstan.

Russia is by far the world's largest natural gas exporter. Most, but not all, authorities believe that Russia has the world's largest proven reserves of natural gas. Sources that consider that Russia has by far the largest proven reserves include the US CIA (47.6 trillion cubic meters), the US Energy Information Administration (47.8 tcm), and OPEC (48.7 tcm). However, BP credits Russia with only 31.3 tcm as of 1 January 2014, which would place it in second place, slightly behind Iran (33.1 to 33.8 tcm, depending on the source). In addition to having the world's largest proven reserves of natural gas, according to US Geological Survey estimations, Russia is also likely to have the world's largest volume of still-undiscovered natural gas: a mean probable volume of 6.7 trillion cubic meters. The USGS estimate of Russia's undiscovered oil is 22 billion barrels, second in the world only to those of Iraq.The Russian oil industry claims to be in need of huge investments. Strong growth in the Russian economy means that local demand for all types of energy sources (oil, gas, nuclear, coal, hydro, electricity) continues to grow.

Seven Sisters (oil companies)

"Seven Sisters" was a common term for the seven transnational oil companies of the "Consortium for Iran" oligopoly or cartel, which dominated the global petroleum industry from the mid-1940s to the mid-1970s. Alluding to the seven mythological Pleiades sisters fathered by the titan Atlas, the business usage was popularized in the 1950s by businessman Enrico Mattei, then-head of the Italian state oil company Eni. The industry group consisted of:

Anglo-Iranian (started as Anglo-Persian) Oil Company (now BP)

Gulf Oil (later part of Chevron)

Royal Dutch Shell

Standard Oil Company of California (SoCal, now Chevron)

Standard Oil Company of New Jersey (Esso, later Exxon, now part of ExxonMobil)

Standard Oil Company of New York (Socony, later Mobil, also now part of ExxonMobil)

Texaco (later merged into Chevron)Preceding the 1973 oil crisis, the Seven Sisters controlled around 85 per cent of the world's petroleum reserves. Since then, industry dominance has shifted to the OPEC cartel and state-owned oil and gas companies in emerging-market economies, such as Saudi Aramco, Gazprom (Russia), China National Petroleum Corporation, National Iranian Oil Company, PDVSA (Venezuela), Petrobras (Brazil), and Petronas (Malaysia). In 2007, the Financial Times called these "the new Seven Sisters".According to consulting firm PFC Energy, by 2012 only 7% of the world's known oil reserves were in countries that allowed private international companies free rein. Fully 65% were in the hands of state-owned companies.

Upstream (petroleum industry)

The oil and gas industry is usually divided into three major sectors: upstream (or exploration and production- E&P), midstream and downstream. The upstream sector includes searching for potential underground or underwater crude oil and natural gas fields, drilling exploratory wells, and subsequently drilling and operating the wells that recover and bring the crude oil or raw natural gas to the surface.Upstream Industry has traditionally experienced the highest number of Mergers, Acquisitions and Divestitures. M&A activity for upstream oil and gas deals in 2012 totaled $254 billion in 679 deals. A large chunk of this M&A, 33% in 2012, was driven by the unconventional/shale boom especially in the US followed by the Russian Federation and Canada.

The aggregate value of Upstream E&P assets available for sale (Deals in Play) reached a record-high of $135 billion in Q3-2013. The value of Deals in Play doubled from $46 billion in 2009 to $90 billion in 2010. With ongoing M&A activity the level remained almost the same reaching $85 billion in Dec-2012. However, the first half of 2013 saw approximately $48 billion of net new assets coming on the market. Remarkably, the total value of Deals in Play in Q3-2013 nearly tripled over 2009 at $46 billion, in less than four years.

World Petroleum Council

The World Petroleum Council (WPC) is an oil and gas industry forum and international organization representing the petroleum sector worldwide WPC has been called "the world’s premier oil & gas forum since 1933." It is widely recognised to "include the most prestigious national oil and gas companies and agencies of the world"

Petroleum industry
Primary industry
Secondary industry
Tertiary industry

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