Oil and Gas Exploration and Production (E&P)

What is oil & gas exploration and production (E&P)?

Oil and gas exploration and production (E&P) is the earliest stage of energy production which involves the search for natural gas and crude oil fields, where extraction through a variety of methods take place. It is the first of three stages - also called upstream - in the cycle to provide the end consumer with a usable oil or gas product. 

Simply put, this stage finds and extracts the raw materials only, where refining, transportation and marketing of the product occurs later down the 'stream'. 

What is the process of oil & gas exploration and production? 

While this upstream stage may only be called exploration and production (E&P), it is a complex process which can be broken up into four major stages: 

1. Search and exploration

2. Well development and construction

3. Extraction and production

4. Site or well abandonment

Search and exploration 

The first of the four stages in E&P involves searching for the primary component of natural gas and petroleum - hydrocarbons. Finding these deposits under the Earth's surface can involve years of research and data collection. Field assessments, various surveying methods including seismic, magnetic and gravimetric surveys as well as geophysical prospecting methods may take place.

The exploration phase collects data to determine the probability of hydrocarbons in a location, estimate how much may be available and accessible, the depth of the deposit and importantly, the risks associated with the location (potentially remote or difficult to access) and the safety of everyone involved if extraction were to take place. 

Well development and construction 

Once a location has been chosen that is likely to produce a viable field, wells are drilled to discover hydrocarbons - called exploration wells. This process can vary greatly depending on characteristics and location of the site where onshore or offshore constructions are established. These exploration tests can determine critical information including potential quantity and quality and the economic viability of the project.

With the right technology, expertise and guidance through Standards, this process can balance logistical needs, environmental & safety considerations and operational efficiencies.

For onshore structures, the International Standard ISO TS 16901:2015(R2018) provides guidelines to assess major safety hazards throughout the planning, design and operation processes of liquified natural gas (LNG) facilities onshore and at shoreline using risk-based methods.

For offshore structures, ISO 19900:2019 specifies general requirements and recommendations for the design and assessment of bottom-founded (fixed) and buoyant (floating) offshore structures.

ISO 19905-3:2017 describes requirements for the site-specific assessment of mobile floating units for use in the petroleum and natural gas industries. 

Extraction and production 

In this phase, extraction occurs, and separation of liquid hydrocarbons, gas, water and other substances take place to remove any unessential products. Extraction methods vary greatly between petroleum and natural gas. Natural gas can potentially be processed at the same site whereas petroleum can only be extracted on site and transported to a refinery to continue the energy production process. 

ISO 20815:2018 plays an important role in the production process in petroleum, petrochemical and natural gas industries. This Standard describes the concept of production assurance within the systems and operations associated with exploration drilling, exploitation, processing and transport of these materials. 

Technological advancements have also significantly improved extraction and production processes in remote locations. Subsea systems, for example, can be remotely operated and used in deep water operations. The ISO 13628 set of Standards sets out the requirements for the design and operation of subsea production systems. 

Advancements in horizontal drilling have also allowed for improved efficiencies and operations through directional drilling - rather than just vertical drilling - allowing better access to deposits. These improvements result in less drills and wells needed for extraction and fewer operating locations.  

Site or well abandonment 

As a deposit or reservoir depletes, or output levels change, operators must reassess performance and consider ceasing extraction and production operations. Well abandonment looks to safely restore the integrity of the location for the long term through sealing up the wells securely. 

Is oil & gas exploration risky? 

Oil and gas exploration can be considered risky if the essential steps are not taken. Natural gas and crude oil fields are becoming increasingly difficult to access than previously encountered. The challenges to find and produce oil can prove difficult if traditional methods no longer satisfy changing expectations of demand, safety and sustainability. 

Standards can not only assist with traditional methods of oil and gas exploration, extraction and production, but also provide guidance for improved methods, for example the potential to leverage and implement new technologies. 

Standardisation is essential to guide safe, sustainable and efficient operations which continue to meet the energy needs of a rapidly growing population. 

The growing need for oil & gas E&P - A global snapshot 

Oil and gas production and consumption have reached all-time high levels, with demand climbing and production struggling to keep up the pace.  

The International Association of Oil & Gas (IOGP) - the voice of the global upstream industry - released their Global Production Report 2020 report highlighting the dependency on imported oil and gas in Asia Pacific and Europe caused by declining production and soaring demand. IOGP reports that “Global oil demand in 2018 was 30% higher than it was in 2000; natural gas demand increased even more dramatically by 60% during the same period.” 

The implications of depleting resources in oil and gas could have devastating affects to economies, countries and communities “which can only be remedied by continuing investment in exploration and production.” 

Standards and the future of the oil & gas industry 

The oil and gas market cannot solely focus on the need to meet demands. Other factors including complexity of projects, volatile markets & prices and implementation of sustainable and cleaner methods is now vital.  

Standards have been developed to improve levels of safety & environmental impact and enhance operations, especially through the integration of new technologies. Companies operating in oil and gas understand the dynamic nature of the industry and recognise the increasing importance of a standardised approach in navigating a complex environment.  

Oil and gas operations are becoming more technical and require the equipment, materials, expertise and guidance to match. Standards provide the information needed to tick all the boxes.  

^{[1] https://www.ibisworld.com/global/market-research-reports/global-oil-gas-exploration-production-industry/}