The oil and gas industry has significant importance in the global economy. Its role goes beyond providing energy, but also the production of a wide range of everyday products. The industry is basically made up of three main segments, each of them responsible for a specific part of the whole process of extracting crude oil from the subsurface and turning it into commercial goods: upstream, midstream, and downstream.
Each segment plays a unique role in the production, transportation, and distribution process of oil and gas products.
In this blogpost, we will explore and describe each of these segments their main characteristics, and what are the challenges they must overcome to keep producing with minimal losses and enhanced profitability.
Upstream operations encompass the exploration and production (E&P) of oil and natural gas, with a primary focus on discovering sources and extracting these resources from the earth’s subsurface. This includes both onshore and offshore drilling, as well as utilizing not-so-popular techniques such as hydraulic fracturing (fracking), Enhanced Oil Recovery (EOR), and Coal Bed Methane (CBM) to extract petroleum and natural gas from underground wells.
Technology plays a crucial role in upstream operations due to the complexity and high costs associated with these activities. The inherent risks and challenges of this segment require advanced technology solutions to ensure, safe, efficient, and effective resource extraction.
Midstream refers to the transportation and storage of oil and gas. It is the bridge between upstream and downstream, connecting exploration and production to end-users.
Normally, this kind of operation includes the use of specific infrastructure able to safely transport the extracted resources through pipelines and terminals to the point of production where the raw material will be refined and become different products.
Pipelines, tanks, and terminals are critical infrastructure for the midstream segment, as they allow for the safe and efficient transportation of these resources over long distances.
However, building and maintaining these huge infrastructures can be a costly and complex task.
As a central challenge, midstream poses risks of environmental and safety incidents, which can have significant consequences. Therefore, finding the right application of advanced technology on assisting the continuous monitoring and early identification of leaks or aggressive corrosion in pipelines is necessary to ensure the safe and efficient operation of these massive infrastructures.
These operations are the last phase of the whole process of O&G exploration. This segment is responsible for the refining and distribution of oil and gas products.
This includes activities such as refining crude oil into finished products such:
- jet fuel
- heating oil
- petrochemical products
This process includes a variety of facilities, such as refineries, petrochemical plants, and retail fuel stations. Refineries are used to process raw crude oil into finished products, while petrochemical plants produce chemicals and plastics from natural gas and oil.
Both of these operations are complex and employ high-risk techniques involving heating, distillation, and pressure tanks to achieve the final product. Beyond needing highly skilled workforce technicians, this process also requires optimal condition monitoring tools for continuous operation and avoiding accidents.
The oil and gas industry is a complex and dynamic system that needs integration and coordination between the downstream, midstream, and upstream for the efficient and effective operation of the industry.
In this context, the implementation of advanced technologies aimed at relevant process aspects has been leading those industries to a reduction of costs, an increase in efficiency, and minimal environmental impact.