Evaluation &

Management of
Petroleum Industry Stages
 Exploration and Development
 Production
 Refining
 Oil Marketing
Exploration and Development

 The oil industry develops its products through different

stages, with more complexity than most industries.
 The main stages in oil are exploration and development,
production, refining, transportation, and marketing.
 ..
Petroleum industry stages from exploration to marketing.
Exploration and Development

 Exploration for oil and gas begins with several kinds of

geological and geophysical surveys.
 Exploration and reservoir development requires more
integrated seismic programs, advanced data analysis
systems, and sophisticated operational techniques.
 3-D and 4-D seismic imaging, basin modeling, remote
sensing integration, and slim-hole drilling.
 Drilling a test well is the necessary next step, to ensure
the presence of oil.
 More confirmation wells have to be drilled near the
discovery well to confirm the amount of oil present.
 Development comes next, when commercial discovery is
demonstrated.
Production

 After a field has been tested commercially, oil

production begins.
 Normally for new fields, oil comes to the surface by
natural drilling force as long as the well’s surface
pressure is less than the pressure in the reservoir.
 However, this natural flow will decline as the well gets
older and cumulative production increases.
 secondary recovery methods such as water and gas
injections and late tertiary recovery are applied.
 Enhanced oil recovery (EOR) has become a challenging
task in order to increase oil recovery rate and reduce
the trapped hydrocarbons in the reservoir.
 The production process starts from the well head to
metering, storage, and export through gathering,
separation, and gas compression, including several
facilities in addition to the utility systems of providing
water, air,
Typical oil and gas production process.
Refining

 Refining is a series of physical and chemical processes

that convert crude oil into many finished oil products.
 The refining industry is located mostly where oil is
consumed.
 Most of the world refineries operate on average at
about 85 percent of refined capacity.
Distribution of refining capacity by region (million barrels/day) as
of the end of 2011. (From BP Statistical Review of World
Energy, London, 2012. With permission.)
Oil Marketing

 Oil product pricing generally depends on crude oil price

and the quality of crude in terms of sulfur content and
density.
 The high quality of crude yields higher-value products
which increases the refinery margins given the refinery
process and configuration.
 However, beyond supply and demand, product pricing is
affected by the degree of market competition, the way
oil products are traded in the financial markets, and the
governments’ regulations.
A static model of the world oil market.