Upstream Oil Companies Research Articles

Effect of green technology investment on crude oil inventory system - a case study based on ONGC data

The carbon footprints are increasing in the environment at an alarming rate mainly due to unplanned human activities. The world?s population will continue to grow at a rapid pace in the future. As a result, our future generations may find it difficult to live on this planet in a healthy manner. The world?s developed and developing countries began to investigate various methods for reducing their carbon footprint. However, it will not be sustainable if it is also not economically viable. In this scenario, maintaining a good profit for businesses while reducing their carbon footprint necessitates a pragmatic strategy. In this article, we will try to find a way out that will provide us with a practical solution. We will simulate the profitability of an upstream oil manufacturer that has invested heavily in green technologies. Under a carbon tax system, we will use the production-inventory model. This system assumes that capital investment in green technology can reduce emissions, and increase profits. We used data from the Oil and Natural Gas Corporation of India, available in its annual reports. As a matter of fact, the Oil and Natural Gas Corporation of India accounts for 70% of crude oil production in India and is a major player in India?s upstream oil companies. The results were quite encouraging, with deviations between expected and actual values being less than 10%. The findings also led us to believe that the excise duty and the pollution control tax levied in India can be regarded as a Green Tax or Carbon Tax. We used a published research model to find the optimal solution.

Gas flaring-induced impacts on aquatic resources in the Niger Delta Region, Nigeria

The Niger Delta is the Nigerian oil and gas province. About 10 – 40% of produced associated gas is underutilized and is flared into the environment. Gas flaring is the burning of natural gas and petroleum hydrocarbons in flare stacks by upstream oil companies in oil fields during operations. Flaring operations have adverse impacts on the environmental components and its aquatic resources. This paper reviewed the impacts of gas flaring on aquatic resources in the Niger Delta Region of Nigeria. The study revealed the induced thermal impacts on the aquatic environment to include alteration of ionic components, pH, temperature, conductivity, heavy metal concentration especially in rain water which could cause death of aquatic biota. Water toxicity from acid rain and heating from flare stacks had also caused some fish species to become extinct. Exposure to harmful air pollutants generated during incomplete combustion of gas had been linked to a variety of health hazards such as: cancer, neurological, reproductive and developmental consequences. It also affects vegetation leading to decrease in growth and productivity probably due to changes in soil quality parameters in the aquatic environment. Climate change has an impact on both physical and biological habitats, influencing biodiversity both directly and indirectly via interactions with other environmental factors. It is recommended that strict government legislations on how gas production projects may be conducted should be introduced and monitored. Regulatory agencies must fulfil their responsibilities of enforcing laws and regulregulations to check gas flaring activities in order to protect the aquatic resources of the Niger Delta Region.

Environmental impact analyses of gas flaring in the Niger delta region of Nigeria

Gas flaringis the burning of natural gas and petroleum hydrocarbons in flare stacks by upstream oil companies in oil fields during operations. Gas flaring is the singular and most common source of global warming and contributes to emissions of carbon monoxide, nitrogen (II) oxide and methane which have the propensity of causing environmental pollution and ecological disturbances or destruction. This research explore and presents a method of analysing the environmental impact of gas flaring in the Niger Delta so to provide the data required for the complete analysis and evaluation of the various observed and noted health and environmental effects of gas flaring in Niger Delta. The major environmental impacts considered in the study are environmental pollution, and ecological disturbance or destruction. Several visitations to the neighbouring communities adjacent to most gas flare locations were carried out to ascertain any existence of common environmental hazards. Data was gathered through a well designed and articulating oral and written questionnaires, direct and first-hand observation of their environment, and comprehensive interview sessions with community heads (royal authorities where possible), patients and youth. Different samples at various proximities from the gas flare locations were taken and measurements and experimentations were meticulously carried out. The result obtained in this research shows a marked trend as all the parameters considered showed a gradient away from the flare point in all the flow stations such as soil pH changing from acidic (4.0-4.2) to near neutral (6.4-6.6) away from the flare points and the average low soil moisture content of (17% - 23%) as against 40% for the (10m and 20m) and control distance. The quantity of carbon emitted by these flare is about 2525000.00 tonnes of carbon per day. These values portray a bad omen for the affected communities. This study recommends that gas flaring should be seen as violet action against the people and that the flared gas should be channelled to meeting the ever increasing demand for energy in the industrial sector of the economy.

Investment Decision Making in the Upstream Oil Industry: An Analysis

Oil is the world‘s biggest and most pervasive business, the greatest of the great industries that arose in the last decades of the nineteenth century.These words of Daniel Yergin in his book, The Prize (1991), which chronicles the development of the world‘s oil industry, highlight the importance of oil industry in the recent times. In an environment of growing competition, higher resource costs, and significant price uncertainty, 'Investment Decision Making' is given top priority. There are many decision making techniques in academic literature. Some fundamental concepts were formulated more than two hundred years ago. But their application became apparent only in the 1950s and 1960s. Their application in practical decision making has been made recently. It is an acknowledged fact that the current practice techniques used for investment decision making in most industries lag behind the current decision theories.Which techniques are most appropriate and applicable to upstream oil industry is what is to be analyzed here. This study draws on the oil industry literature to find the techniques used by upstream oil companies. It tries to identify the techniques that are available and what are the tools appropriate for upstream investment decision making. Each tool has certain limitations. Thus, a combination of decision analysis techniques and concepts are to be used.The rationale behind this study is the assumption that the techniques used would be adding value to the upstream oil companies. This assumption would then be tested to verify this relationship. The risk and uncertainty involved in each technique is also considered.Investment appraisal, industry literature and the insights gained from various conferences, seminars etc. are used to draw conclusions.

Risk management for oil producing companies

Some hedge techniques against a risk in changing oil prices were explained in this lecture. Swap, option and collar were introduced. They were simple but very effective to hedge the risk for up-stream oil companies. Also, some consequent issues when applying these hedge techniques were discussed. Finally a total risk management system was proposed to reduce any kinds of risk and to establish company's strategy.