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Energy Glossary




Economic interest An interest in oil and gas in the ground. It entitles the owner to a deduction from gross income derived from production of that oil and gas as specified in Federal income tax regulations.
Electric Wireline Wireline that contains an electrical conduit, thereby enabling the use of downhole electrical sensors to measure pressures and temperatures.
Electrical well logging A method of oil exploration that originated with Conrad Schlumberger, who first tested it in 1927 on a 1,500-meter well in France. As used today, the process is very simple. Current passes into the ground, through the resistive medium and into the sonde. The resulting charts show the varying resistance, the conductance, and the self-potential of the strata surrounding the well at every level, and geophysicists use them to assay whether petroleum is present in a formation.
Enhanced oil recovery Injection of water, steam, gases or chemicals into underground reservoirs to cause oil to flow toward producing wells, permitting more recovery than would have been possible from natural pressure or pumping alone.
EUR or estimated ultimate recovery The amount of oil or gas estimated to be produced over a well’s lifetime, prior to plugging and abandoning the well because it is no longer economic to produce.
Ethanol The two-carbon-atom alcohol present in the greatest proportion upon fermentation of grain and other renewable resources such as potatoes, sugar, or timber. Also called grain alcohol.
Expenses (Tax Usage) Expenditures for business items that have no future life (such as rent, utilities, or wages) and are incurred in conducting normal business activities.
Exploration The search for oil and gas. Exploration operations include: aerial surveys, geophysical surveys, geological studies, core testing and the drilling of test wells.
Exploratory well Is drilled to find oil or natural gas where none has been produced before.
External casing packer A device used on the outside of the well casing to seal off formations or protect certain zones. The packer is run on the casing and expanded against the wall of the borehole at the proper depth by hydraulic pressure or fluid pressure from the well.
Extraction plant A plant for the extraction of the liquid constituents in casinghead gas or wet gas.


Farm in When one company drills wells or performs other activity on another company’s lease in order to earn an interest in or acquire that lease.
Farm-in or farm-out Is an agreement in which the owner of a working interest in a n oil and gas lease gives some or all of that interest to another party (company) that will drill on the leased acreage.  The party farming out the working interest usually retains a royalty or reversionary interest from the party that is fanning in.
Farm out agreement An arrangement in which the responsibility of exploration and development is shifted (by assignment) from the working interest owner to another party.
Fault A planar fracture in rock in which the rock on one side of the fracture has moved with respect to the rock on the other side.  Movement of rocks against other rocks within the subsurface can create discontinuities in the rock strata that can then in turn act as “traps” to prevent hydrocarbons from moving any further in the subsurface.
Fault trap A geological formation in which oil or gas in a porous section of rock is sealed off by a displaced, nonporous layer.
Fee lands Privately owned, nonpublic lands.
Feet of pay The thickness of the pay zone penetrated in a well.
Field An area that contains a single reservoir or related reservoirs with the same geological structural feature or stratigraphic condition. It may contain dozens or hundreds of wells.
Fishing Recovering the tools or pipe that have been accidentally lost down the borehole by using specially designed tools that screw into or grab the missing equipment.
Fishing tools Special instruments equipped with the means for recovering objects lost while drilling the well.
Flaring The burning of gas vented through a pipe or stack at a refinery, or a method of disposing of gas while a well is being drilled. Flaring is regulated by state agencies. Venting (letting gas escape unburned) is generally prohibited.
Flooding One of the methods of enhanced oil recovery. Water flooding or gas flooding might be considered secondary recovery methods.
Flowing well A well that produces through natural reservoir pressure and does not require pumping.
Formation A geological term that describes a succession of strata similar enough to form a distinctive geological unit useful for mapping or description.
Fossil fuels Fuels that originate from the remains of living things, such as coal, oil, natural gas, and peat.
Fracture stimulation Also called hydrofracing.  An operation that involves large pumps that inject, at high pressure, many gallons of water or other fluids, and pounds of proppant (sand or ceramic) down the well casing and out into the formation.  The mixture fractures the rock so oil or gas can be released through the fractures and flow up the well bore.
Front-end costs Costs that are paid out of initial investment in a venture, first, before the venture activities actually begin.


Gamma-ray logging A technique of exploration for oil in which a well’s borehole is irradiated with gamma rays. The varying emission of these rays indicates to geologists the relative density of the rock formation at different levels.
Gas cap The gas that exists in a free state above the oil in a reservoir.
Gas condensate Liquid hydrocarbons present in casinghead gas that condense when brought to the surface.
Gas lift A recovery method that brings oil from the bottom of a well to the surface by using compressed gas. Gas pumped to the bottom of the reservoir mixes with fluid, expands it, and lifts it to the surface.
Gas-cut mud Drilling mud permeated with bubbles of gas from downhole. The circulation of such mud can be severely impaired, seriously affecting drilling operations.
Gas-oil ratio The number of cubic feet of natural gas produced along with a barrel of oil.
Geophones The sound-detecting instruments used to measure sound waves created by explosions set off during seismic exploration work.
Geophysicist A geophysicist applies the principles of physics to the understanding of geology.
Gravimeter A geophysical device that has been particularly useful in finding salt domes. Actually, it is a weight on a spring. The spring gets longer in high-gravity areas and shorter in areas of gravity-minus. Magnetism helps the oil geologist understand its measurements.
Gross income Total income from an activity, before deduction of (1) items that may be treated as expenses (such as intangible drilling costs), and (2) allowed tax items (such as depletion allowance, depreciation allowance, etc.).
Groundwater The water in underground rock strata that supplies wells and springs.
Gun perforation A method of creating holes in a well casing downhole by exploding charges to propel steel projectiles through the casing wall. Such holes allow oil from the formation to enter the well.


Heavy oil A type of crude petroleum characterized by high viscosity and a high carbon-to-hydrogen ration. It is usually difficult and costly to produce by conventional techniques.
Held by production Refers to an oil and gas property under lease, in which the lease continues to be in force, because of production from the property.
Horizon A specific sedimentary layer in a cross section of land, especially one in which a petroleum reservoir is found.
Horizontal drilling A developing technology that makes it possible to drill a well from the surface, vertically down to a certain level, and then to turn at a right angle, and continue drilling horizontally within a specified reservoir, or an interval of a reservoir.
Hydraulic fracturing A method of stimulating production from a low-permeability formation by creating fractures and fissures by applying very high fluid pressure.
Hydrocarbons Chemical compounds consisting of hydrogen and carbon.  Crude oil, natural gas, and natural gas condensate are all mixtures of various hydrocarbons, among which methane is the simplest.
Hydrometer An instrument that measures the specific gravity of liquids.
Hydrostatic head The height of a column of liquid. The difference in height between two points in a body of liquid.


In situ In its original place. Refers to methods of producing synthetic fuels underground, such as underground gasification of a coal seam or heating oil shale underground to release its oil.
Initial potential Flow rate measured during the initial completion of a well in a specific reservoir (initial daily rate of production).
Injection well A well employed for the introduction into an underground stratum of water, gas or other fluid under pressure. Injection well are employed for the disposal of salt water produced with oil or other waste. They are also use for a variety of other purposes: 1) Pressure maintenance, to introduce a fluid into a producing formation to maintain underground pressures which would otherwise be reduced by virtue of the production or oil or gas, 2) Secondary recovery operations, to introduce a fluid to decrease the viscosity of oil, reduce its surface tension, lighted its specific gravity, and drive oil into producing wells, resulting in greater production of oil.
Intangible drilling costs Expenditures, deductible for federal income tax purposes, incurred by an operator for labor, fuel, repairs, hauling, and supplies used in drilling and completing a well for production.


Jack or Unit An oil-pumping unit. The pumping jack’s walking beam provides the up-and-down motion to the well’s pump rods.
Jetting Injecting gas into a subsurface formation for the purpose of maintaining reservoir pressure.
Joint A single section of drill pipe, casing, or tubing, usually about 30 feet long.


Kelly bushing Part of the drilling rig, the Kelly is a long hollow steel bar that connects to the upper end of the drill string.
Kerogen The petroleum fraction containing hydrocarbons that are slightly heavier than those found in gasoline and naphtha. Kerosene (also spelled kerosene) was the most important petroleum product because of its use for home and commercial lighting; in recent years demand has risen again as a result of kerosene’s use in gas turbines and jet engines.
Kick When the pressure encountered in a formation exceeds the pressure exerted by the column of drilling mud circulating through the hole. If uncontrolled, a kick leads to a blowout.
Kill a well To overcome downhole pressure by adding weighting elements to the drilling mud.