O&G Glossary: ​​understand the key terms of this market

The area of ​​exploration and production in deep or shallow waters is quite technical. Therefore, every professional in the field must know the O&G — Oil & Gas — glossary to perform their activities well. With the help of Wilson Sons’ New Business Project Analyst, Celso Costa, let’s see which ones are the most common! Stay tuned!

ANP 

The National Agency of Petroleum, Natural Gas, and Biofuels (ANP) is the regulatory body responsible for setting the rules and standards and overseeing the implementation of national policies in the oil, natural gas, and biofuels sector.

Its main duties include the promotion of bidding rounds and the conclusion of contracts for the exploration, development, and production of oil and natural gas on behalf of the Union.

BOE 

BOE — Oil Equivalent Barrel — is a widely used unit for comparing the energy potential of natural gas in relation to crude oil, thus being able to measure the volume of production and distribution of oil and natural gas. One BOE corresponds to 6 MCF (thousands of cubic feet) or 169.9 m³ of gas.

Downstream

Set of activities ranging from refinery product transportation to distribution to the final consumer. It can also be defined as the set of transportation, distribution, and sale of oil derivatives operations.

Drillship

Ship used as a drilling rig, that is, its main activity is the drilling of submarine wells, mainly in deep and ultra-deep waters. Although there are other types of probes, companies have been preferring this model.

Onshore/ Offshore 

The prospection, exploration, and production of oil can be done on land, called Onshore, or at sea, known as Offshore. Both terms are defined by the Decree No. 8.437/15, which establishes the typologies in activities in which environmental licensing is the responsibility of the Union.

Farm-in/ Farm-out 

Terms used for the acquisition (Farm-in) or sale/return (Farm-out) of the exploration and production rights of exploratory areas and fields of Oil and Natural Gas production.

Exploration Phase

Exploration is the stage at which companies evaluate their assets through geological and geophysical exploratory activities for greater knowledge of the acquired area. This includes seismic data acquisition, drilling, and well evaluation. Thus, it is possible to identify the economic viability of the discovery.

Production Phase

It is the phase that occurs after the economic viability of the area is proven. The discovery officially becomes a producing field and goes through the development stage, when the necessary infrastructure such as drilling of wells and installation of the platforms is implemented, and the production stage, when the field starts producing to supply the market.

The latter can last months or even decades, depending on the productive capacity of the field.

FPSO

Floating Production, Storage, and Offloading (FPSO) are floating units of production, storage, and unloading. These are large ships that can produce, process, and even store oil and natural gas. They come into operation when the development phase (post-exploration) begins and can normally operate for up to 25 years without the need to return to land.

FSRU 

A Floating Storage Regasification Unit is a vessel that can convert the received liquefied natural gas into its gaseous form, making it suitable for distribution to end consumers.

Natural Gas

A gaseous hydrocarbon compound that originates from the decomposition of organic matter, found in underground or ocean floor deposits.

IOC 

IOC stands for International Oil Company, which is a private oil and gas company that may be Brazilian or international. Examples of such companies are Petrorio (Brazilian), Shell (Anglo-Dutch), ExxonMobil (American), and Total (French).

LNG

Liquefied Natural Gas (LNG) is the purified natural gas. In this process, it is condensed to the liquid state by reducing the temperature to minus 163 degrees Celsius. The purpose of this conversion is to facilitate transport, especially in regions not equipped with pipelines.

Operation Spot

Term inherited from the financial market that serves to designate punctual and short-term transactions involving O&G.

OSV 

OSV — Offshore Supply Vessel — consists of a category of offshore support vessels. Among them are the PSV, AHTS, OSRV, among others.

Petroleum

Complex hydrocarbon mixture that can be categorized as light, medium, and heavy according to their molecular density. It serves as a base and raw material for the manufacture of various products and fuels such as gasoline and diesel.

PSV/ AHTS/ OSRV 

The Platform Supply Vessel (PSV) is a support vessel with large storage capacity and that explores Offshore Exploration, Development, and Production units.

Anchor Handling, Tug and Supply (AHTS) is a support, towing and anchor handling vessel capable of assisting more complex operations such as platform anchoring.

An Oil Spill Recovery Vessel (OSRV) is a vessel equipped with oil pickup systems, typically used in situations of oil spills at sea or in watercourses.

Upstream 

The whole circuit of activities ranging from extraction to transportation of crude oil to refineries. It can also be defined as the set of crude oil production and transportation operations from the producing field to the Refinery.

Other common terms

In addition to the highlighted terms, there are others that also deserve highlighting in an O&G glossary. According to Celso Costa, they are the ones we listed below.

Bacias de Novas Fronteiras

The Bacias de Novas Fronteiras area whose potential has not been measured is called a new frontier. These are generally little explored sedimentary basins that require activities and studies for their large-scale exploration.

Light/heavy oil

The different types of oil are characterized by their hydrocarbon content. To facilitate measurement, an API (American Petroleum Institute) grade was created that measures oil density using the formula: API Grade = (141.5 / Sample Density) – 131.5.

The lightweight ones have API greater than 30 and are used in the manufacture of noble products like Naphtha – Petrochemical Industry Input. In Brazil, this oil is found in pre-salt.

Medium oils have APIs between 22 and 32, while heavy oils have an API of less than 22 and are used to manufacture products such as asphalt and fuel oil.

Pre-salt

The pre-salt layer is a rocky layer located below a salt layer that can reach 8,000 meters deep. The term was popularized after the discovery of large reserves of light oil off the Brazilian coast.

Brent 

Crude oil classification used to denote the mixture of oil types originating in the Ninian and Brent oil systems produced in the North Sea.

WTI

Another crude oil classification used to designate the mixture of petroleum types originating from Permian Basin petroleum systems, located in western Texas, United States.

So, you got all your questions answered with this O&G Glossary? We hope so! The jargon of the medium is extensive and understanding it correctly is fundamental to the interpretation of texts and documents.

 Since you’re already here looking for information that makes a difference and get to know the prospects for the future of the oil and gas market in Brazil.