Introduction to Oil & Gas Industry, 
    Accounting & 
    Financial Statement Analysis
    Copyright © by Wall Street Prep, Inc. | All rights reserved        1
 Oil & gas industry sectors and players
     A number of distinct yet 
     interconnected sectors
     • There are a number of                      Transportation
       sectors that make up the 
       O&G industry – each 
       focused on a specific 
       process in the value chain.   Exploration     O&G          Refining &
     Companies focus on one             &           Sector        Marketing
                                     Production
     sector
     • Given the complexities of 
       this extractive industry, 
       most companies focus on                      Oilfield
       one particular sector.                       Services
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 Oil & gas industry sectors and players
    Mission – to find and extract               Crude terms
    • The Exploration & Production sector       • Exploration & Production 
      involves all operations associated with     is typically referred by its 
      finding and extracting oil and gas.         acronym: E&P.
    • E&P sector can be broken out into the     • Companies focused only 
      exploration and production                  on this sector are 
      components.                                 referred to as E&P 
    • Timing between the two components           companies.
      can take years (and usually does!).       • E&P is also known as the 
                                                  upstream sector, to 
                                                  indicate the upward 
                                                  extraction of the 
                                                  commodities.
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 Oil & gas industry sectors and players
                 Timing Varies                    5-10 Years
                    Exploration                      Production
                      Phase                           Phase
       • Pre-license prospecting        • Primary recovery method
       • Property/land rights           • Secondary recovery method
         acquisition                    • Tertiary (enhanced) recovery method
       • Exploration drilling
       • Evaluation and appraisal
       • Development
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