Chances are if you've watched any TV or read the news lately, you've heard or seen something about the oil and natural gas boom in the United States and the jobs that have been created because of it.
You may have heard about Shale Oil or Shale Gas and terms like "shale play," "hydraulic fracturing" (or "fracing"), and "horizontal drilling." If you're like most people, you may be wondering what this all means and why it is important. Use the resources here to learn about these things and more.
Watch these videos to learn about shale, the oil and natural gas industry, and what is involved in turning these underground resources into energy and products we use every day.
Watch these videos to see if working in the oil and natural gas industry is right for you.
Learn more about the active U.S. shale plays – areas where oil or natural gas has been found in the shale formations. Click a name on the map for information about that shale play
The Upstream sector is what most people think of when they hear about the oil and gas industry and is often referred to as exploration and production (E&P). This includes searching for oil and gas reserves, leasing the land, drilling exploratory wells, and then operating the wells to extract the oil and natural gas from the shale.
The Midstream sector provides the link between the wells that are often in remote areas and where the consumers are located. It involves collecting, transporting, and storing the crude oil, natural gas, and natural gas liquids (e.g., ethane, propane, and butane), as well as marketing the oil and gas products.
The Downstream section includes refining and processing the raw materials into usable products, as well as distributing the products to the consumer.
The first step in the process is locating the oil and gas reserves. Geologists study a wide range of information including geological maps, seismic conditions, and images to determine areas with potential for producing oil and gas.
Land agents lease or purchase land and underground mineral rights from the property owners in the areas where the oil and gas company is interested in drilling.
After the well is completed, separation and sometimes pumping equipment is installed to bring the oil or gas to the surface. Storage tanks are installed to collect any produced oil, natural gas liquids, and production water from the well.
It takes a relatively short time (70 to 100 days) to bring a well to completion, but the well can be in production for a number of years or decades. Production technicians (also known as lease operators, well tenders, or well pumpers) are responsible for monitoring the day-to-day operations of the well.
Once permits are in place, the oil and gas company usually hires a contractor to prepare and build the site and hires a drilling company to drill the well. Once the well is drilled to a specified depth, during the well logging phase measurements are taken to determine the presence of oil or gas. If the well is a vertical well, well logging is completed after drilling; if the well is a horizontal shale well, the logging can be done while drilling the lateral. If engineers and geologists studying the information determine that there is enough oil or gas for the well to be productive, the well is completed. Well completion includes the hydraulic fracturing (“fracing”) process for extracting the oil or gas from the shale. If there is not enough gas or oil present to be productive, the well is filled with cement, plugged, and abandoned.
Before drilling, the oil and gas company must apply for the necessary permits from the state’s regulatory agencies. Each state has its own regulations regarding permit application and drilling.
Oil: Crude oil that has been pumped from the well is collected in tanks located at the well site or sent through pipelines called gathering lines to tanks at a central location. It may then be sent through larger trunk pipelines or pumped into tank trucks to be taken to the refineries.
Gas: Natural Gas wells are also connected via gathering lines. While crude oil can be transported in its natural site, sometimes natural gas must either be compressed or liquefied before it is transported. The pressure of the gas is increased at compressor stations before it enters the larger intrastate and interstate pipeline systems and periodically during transport.
If other means of transporting the gas, such as tanker ships and trucks, are necessary, then the gas is converted to a liquid state by chilling to extremely low temperatures to greatly reduce its volume.
Crude oil is sold to the refineries that create products for the consumers.
Gas marketers find buyers for natural gas. This may involve working with pipeline companies, distribution companies, or large end users such as factories, businesses, and schools.
Storage of oil and gas balances the fluctuations between supply and demand and helps ensure a steady supply of oil and gas products throughout the year. For example, natural gas can be produced and the surplus stored during the summer months to be available for the increased demand during the winter.
Crude oil is usually stored in above ground tanks that are often near the refineries. Most natural gas storage is in underground reservoirs.
Oil: At the refineries, crude oil is converted into usable products. The majority of these products are fuels such as gasoline, diesel fuel, jet fuels, heating oil, kerosene, etc. However, non-fuel products, including asphalt, road oil, and lubricants, are produced at the refineries as well.
Gas: Natural gas used for cooking and heating is 90% methane. It is processed to remove contaminants such as water and sulfur. This is done before being transported through the interstate pipelines. Depending on the geological conditions of the shale in some areas, the gas may contain natural gas liquids containing ethane, propane, and butane that need to be separated from the methane into distinct products.
Oil: The consumer products (gasoline, diesel fuel, etc.) are distributed to retailers, such as gas stations and heating oil companies, that sell the products to the consumer.
Gas: Natural gas distribution companies deliver the natural gas via pipelines to consumers at their homes, factories, businesses, schools, etc.
While not directly related to getting the oil and natural gas to the consumer, petrochemical plants are sometimes included in the downstream sector. Petrochemicals are derived from the crude oil or natural gas liquids (ethane, propane, butane, etc.) and are used to manufacture a wide variety of products people use every day including plastics, medicines, medical devices, cosmetics, and much more.