Glossary of Oil Terms

The following are terms that I frequently hear on the Oil boards on fool.co.uk. Hopefully it’ll help me understand what the knowledgeable posters there are talking about.

1P: Hydrocarbon volume considered to be proven by the drilling of the well. There is a very high chance that this volume exists in the ground around the well bore.
2P: Hydrocarbon volume considered likely (probable) to have been found by the drilling of the well, given the mapping that has taken place. 2P is then proved plus probable volumes.
3P: An estimate of the volume of hydrocarbons in the trap area that possibly exist. 3P is then proved plus probable plus possible volumes.
Anticlinal trap: A hydrocarbon trap formed by the upward bowing of strata into an arch or dome.
Anticline: A tectonic structure in which strata are folded so as to form an arch or dome.
Appraisal well: A well drilled to determine the extent of hydrocarbons discovered in a previous well on the same structure.
ASX: Australian Stock Exchange Limited.
ATP: Authority to Prospect.
Barrel (bbl): The unit of volume measurement used for petroleum and its products.
1 barrel: = 42 U.S. Gallons = 35 Imperial Gallons (approx.) or 159 litres (approx.)
Basin: A depression of large size in which sediments have accumulated.
BCF: Billion cubic feet (1 BCF = 1.08 Pj).
bopd: Barrels of oil per day.
Closure: The area within the lowest closing contour of a structure and also a closed structure.
Coal Seam Gas (CSG): Natural gas (mostly methane) contained within coal.
Condensate: Hydrocarbons (predominantly pentane and heavier compounds) which spontaneously separate out from natural gas at the wellhead and condense to liquid.
Director: A Director of the Company.
Dry hole: A well drilled without finding gas or oil in commercial quantities.
Drill Stem Test (DST): The controlled flowing of the fluids from a reservoir so that estimates of the flow rate and fluid type can be made. It is usually conducted for a short time only. It can be run in open hole or through perforations in a cased hole.
Exploration well: A well drilled to determine whether hydrocarbons are present in a particular area or structure.
Fault: A fracture in the Earth’s crust along which the rocks on one side are displaced relative to those on the other.
Fault trap: A hydrocarbon trap which relies on the termination of a reservoir against a seal due to fault displacement.
Field: A geographical area under which an oil or gas reservoir lies.
Formation: A unit in stratigraphy defining a succession of rocks of the same type.
Gas in Place (GIP): An estimated measure of the total amount of gas contained in a reservoir and, as such, a higher figure than Recoverable Gas.
Geology: The science relating to the history and development of the Earth’s crust.
Geophysics: The physics of the Earth; a hybrid discipline involving a combination of physical and geological principles.
Gigajoule (Gj): 1,000,000,000 joules.
Horizon: A term used in seismic interpretation to identify the signal reflected from a particular layer of rock.
Hydrocarbon pay: A net sand interval containing moveable (recoverable) hydrocarbons.
Hydrocarbons: Naturally-occurring organic compounds containing only the elements hydrogen and carbon that may exist as solids, liquids or gases.
Interstate Group of Companies: A term used when referring to the companies acquired on 1 July 2003 being Interstate Energy Pty Ltd, Interstate Pipelines Pty Ltd, ACN 002 820 555 Pty Ltd and ACN 081 118 292 Pty Ltd.
Lead: Inferred geologic feature or structural pattern requiring investigation.
Licence: An authority to explore for or produce oil or gas in a particular area issued to a company by the governing state.
Lithology: The physical and mineralogical characteristics of a rock.
Log interpretation: Technical analysis of the results of well logging leading to quantitative estimates of various rock properties including contained liquids and gases.
Migration: The movement of hydrocarbons from regions of higher to lower pressure.
MMBBL: 1 million barrels of oil.
MMcfd: 1 million cubic feet per day = 28,317 cubic metres per day.
Oil: A mixture of liquid hydrocarbons of different molecular weights.
Permeability: A measure of the capacity of rock or stratum to allow water or other fluids such as oil to pass through it. Typically measured in darcies or millidarcies.
Permian: A geological time period approximately 298 to 251 million years ago.
Petroleum: A generic name for hydrocarbons, including crude oil, natural gas liquids, natural gas and their products.
Pj: Petajoule (one million gigajoules).
PL: Petroleum Lease.
Potential Oil/Gas: (In-Place): An estimate of the potential size of a trap expressed in terms of either oil in place or gas in place. In deriving this estimate it is first assumed there is an accumulation present, and then a theoretical model is employed to calculate the size of the accumulation, using informed estimates of key factors such as geometric fill factors, net pay, reservoir quality, hydrocarbon type, and water saturation.
Prospect: A feature sufficiently defined to warrant the drilling of a well without the necessity of further investigation.
Recoverable Gas: An estimated measure of the total amount of gas that could be brought to the surface from a given reservoir.
Recoverable Oil: An estimated measure of the total amount of oil that could be brought to the surface from a given reservoir.
Reserves: The volume of hydrocarbons contained in a trap or stored in coals that is economically recoverable.
Reservoir: Permeable and porous rocks (usually sandstone, limestone or dolomite) capable of containing significant quantities of hydrocarbons.
Sandstone: A sedimentary rock composed predominantly of sand-sized grains, usually quartz.
Santos: Santos (QNT) Pty Ltd.
Seal: An impermeable rock (usually claystone or shale) that prevents the passage of hydrocarbons.
Sediment: Solid material, whether mineral or organic, which has been moved from its position of origin and redeposited.
Seismic Survey: A technique for determining the detailed structure of the rocks underlying a particular area by passing acoustic shock waves into the strata and detecting and measuring the reflected signals.
Show: An indication of oil or gas from an exploratory well.
Stratigraphy: The study of stratified rocks, especially their age, correlation and character.
Structure: Deformed sedimentary rocks, where the resultant bed configuration is such as to form a trap for migrating hydrocarbons.
Terajoule: (Tj) one thousand gigajoules.
The Company and Sunshine Gas: Sunshine Gas Limited ACN 098 563 663.
Trap: A body of reservoir rock, vertically or laterally sealed, the attitude of which allows it to retain the hydrocarbons that have migrated into it.
Trend: A strike direction of a geological feature.
UKCS: United Kingdom Continental Shelf.
Wireline log: A geophysical tool lowered into the well on a wireline to measure resistivity, gamma radiation, density and other parameters from which rock properties such as porosity and water saturation can be measured.