Page 302 - Introduction to Petroleum Engineering

15

MIDSTREAM AND DOWNSTREAM
OPERATIONS

The oil and gas industry can be separated into three sectors: upstream, midstream,
and downstream. The upstream sector includes the subsurface resource, its pro-
duction to the surface, and the basic facilities at the well location (such as wellhead,
separator, and storage tanks). The midstream sector connects the upstream and
downstream sectors, and it encompasses the transportation and storage of oil and gas
between upstream production operations and downstream refining and processing
operations. An alternative classification to the three‐sector system is to view the oil
and gas industry as two sectors: upstream and downstream. In the case of the two‐
sector system, the midstream sector is part of the downstream sector. We discussed
the upstream sector previously. The midstream and downstream sectors are discussed
in this chapter. We then present a case study to illustrate the effort that can be required
to create the infrastructure needed for midstream and downstream operations.

15.1 THE MIDSTREAM SECTOR

Midstream operations are designed to transport hydrocarbons from upstream
production operations to downstream refining and processing operations. Many
modes of transportation are used to transport oil and gas. They include pipelines,
tanker trucks and ships, and trains. The mode of transport depends on such factors as
safety, distance, and state of the fluid. For example, pipelines are often the first choice

Introduction to Petroleum Engineering, First Edition. John R. Fanchi and Richard L. Christiansen.
© 2017 John Wiley & Sons, Inc. Published 2017 by John Wiley & Sons, Inc.
Companion website: www.wiley.com/go/Fanchi/IntroPetroleumEngineering