Oil & Gas 101

Wyoming's Greatest Resource

Oil and Gas is the single largest economic driver in the State of Wyoming. PAW members produce 90% of Wyoming’s oil and gas, generating over $8 billion in economic activity and employing more than 19,000 of Wyoming’s hard-working men and women. Every one of our member organizations goes to great lengths to keep our industry and state moving forward with a keen focus on safety, innovation and the environment. Improving public awareness and educating Wyomingites about these issues are paramount to the Petroleum Association of Wyoming.

Here you will find resources for a general overview of the industry. For more in depth information on how oil and gas impact Wyoming, check out our Oil and Gas Facts and Figures.

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Oil and Gas 101 – Petroleum Association of Wyoming

The Basics of the Industry

A general overview of the oil and gas industry in Wyoming — from geologic basins and supply chains to upstream drilling, midstream transportation, and downstream refining.

Oil and Gas in Wyoming

According to the Wyoming State Geological Survey (WSGS), Wyoming consistently ranks in the top ten in the United States for both oil and gas production, with the majority of historic and current activity taking place in one of eight distinct geologic basins:

Bighorn Basin Laramie Basin Denver-Julesburg Basin Overthrust Belt Greater Green River Basin Powder River Basin Hanna Basin Wind River Basin

The WSGS also provides an up-to-date Interactive Oil and Gas Map including active development fields, pipelines, and the latest well information from the Wyoming Oil and Gas Conservation Commission.

At the national level, the American Petroleum Institute has created interactive diagrams of both the oil and natural gas supply chains, providing an informative overview of the entire process. At its core, the industry can be distilled into three sections:

Upstream — Exploration and Production, including drilling and bringing product to the surface.
Midstream — Safe transportation and storage prior to refining, including pipelines.
Downstream — Refining, manufacturing, and marketing the products used in our daily lives.

Oil Supply Chain Natural Gas Supply Chain
Wyoming Oil and Gas Basins Map
WSGS Resource
Wyoming Oil & Gas Basins Map
The Wyoming State Geological Survey's comprehensive map of oil and gas basins, active fields, and production areas across the state.
Download Map PDF Interactive Map
Upstream Activities

Drilling a Well

Drilling today is comprised of multimillion-dollar operations designed to efficiently produce oil and natural gas while minimizing impacts to the surrounding area. Advances in horizontal drilling and hydraulic fracturing have further reduced the number of well pads needed to realize a field's potential fully.

Midstream Activities

Transportation

Oil and gas are transported from the source to midstream and downstream facilities through a variety of means, including a network of gathering and transmission pipelines. Currently, there are more than 500,000 miles of pipelines in the United States carrying oil and gas products, including more than 30,000 miles in Wyoming.


Pipeline companies invest heavily in the inspection and maintenance of this network to ensure their safe and continued operation.

Downstream Activities

Refining

Crude oil and natural gas are not ready for end-user consumption when extracted from the ground. These hydrocarbons must be processed into the various fuels and manufacturing feedstocks that are used to supply the market with a wide array of consumer products.


In addition to fueling our commutes and creating many of the products we use today, petroleum-based energy production is energizing our future. According to the U.S. Energy Information Administration, approximately 36% of all energy production in the United States is derived from petroleum-based fuels.

Environmental Responsibility

PAW Members take environmental responsibility seriously — not only because it is the right thing to do, but also because they call Wyoming home. The oil and gas industry invests heavily in education, research, and technology to ensure that production happens efficiently and sustainably.


The goal is to be good neighbors and pass on to future generations the open spaces, wildlife, and clean air we, here in Wyoming, enjoy today.

Our Commitment to Wyoming

  • Heavy investment in education, research, and technology for sustainable production
  • Minimizing surface disturbance through advanced drilling techniques
  • Protecting open spaces, wildlife habitat, and clean air for future generations
  • Ongoing monitoring and maintenance of pipeline infrastructure
  • Compliance with state and federal environmental regulations

Glossary of Terms

Key terminology used in Wyoming's oil and gas industry
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
No terms match your search.
A
Anticline
An arch of stratified rock in which the layers bend downward in opposite directions from the crest that may trap hydrocarbons.
Application for Permit to Drill (APD)
A Wyoming Oil and Gas Conservation Commission application required before any owner or operator shall spud in anticipation of drilling any well on fee, patented, state, or federal lands, or deepen/re-enter any such wells by drilling to a lower formation.
Aquifer
A water-bearing stratum of permeable rock, sand, or gravel from which groundwater can be extracted.
B
Barrel
A basic unit for measuring oil equal to 42 U.S. gallons.
Barrel of Oil Equivalent (BOE)
A way of standardizing energy resources to the equivalent of a barrel of oil. One BOE equals 6,000 cubic feet of natural gas.
Bit
A drilling tool that cuts the hole in one of two fashions — up and down to pulverize (cable tool bit) or revolving to grind (rotary bit).
Bitumen
A black viscous mixture of hydrocarbons obtained naturally or as a residue from petroleum distillation. Used for road surfacing and roofing.
Blowout
The uncontrolled release of crude oil and/or natural gas from an oil well or gas well after pressure control systems have failed. Modern wells have blowout preventers intended to prevent such an occurrence.
BOED
Barrels of Oil Equivalent per Day.
Borehole
A hole in the earth made by a drilling rig.
British Thermal Unit (BTU)
The heat required to raise the temperature of a one-pound mass of water by one degree Fahrenheit. Also used to compare energy potential of different types of fuels.
C
Carbon Capture and Storage (CCS)
A process by which carbon dioxide is captured and removed from the atmosphere and then stored in an underground geological formation.
Carbon Sequestration
A natural or artificial process by which carbon dioxide is removed from the atmosphere and held in solid or liquid form.
Casing
Steel pipe placed in wells to isolate formation fluids (such as fresh water) and to prevent the hole from caving in.
Christmas Tree
The assembly of valves, pipes and fittings used to control the flow of oil and gas from the casinghead.
Coal Bed Methane (CBM)
Natural gas extracted from coal beds.
Completion
The process of making a well ready to produce natural gas or oil — including the installation of permanent equipment, such as a wellhead, and possibly hydraulic fracturing.
Condensate
A mixture of hydrocarbons which are gaseous under natural conditions and become a liquid as the temperature and pressure is reduced during production. Also referred to as natural gasoline and distillate.
Crude Oil
A naturally occurring, unrefined petroleum product composed of hydrocarbon deposits and other organic materials.
D
Derrick
The framework over an oil well or similar boring that holds the drilling machinery.
Development Well
A well drilled within a proven area of an oil or gas reservoir to a known productive depth.
Directional Drilling
The drilling of a well that departs materially from the vertical direction.
Downstream
Activities in the oil and gas industry which take place away from the source of the supply — including refining and marketing.
Drilling Rig
A collection of structures and equipment used in drilling an oil or gas well including the derrick, engine, engine house and other equipment. Also known as a rig.
Dry Gas
Natural gas, almost pure methane, which does not contain dissolved liquid hydrocarbons.
Dry Hole
A completed well which is not productive of oil and/or gas, or which is not productive enough to be economically viable.
E
Enhanced Oil Recovery (EOR)
The application of one or more processes that seek to improve recovery of hydrocarbons from a reservoir after an initial production phase.
Enhanced Oil Recovery Institute (EORI)
The EORI was created and is financially supported by the Wyoming State Legislature to work with Wyoming oil producers to increase oil production and, as a result, increase tax revenues of the state. EORI is part of the School of Energy Resources at the University of Wyoming.
Exploratory Well
A well drilled within a previously proven field in an effort to locate oil or gas in another reservoir.
F
Field
An area consisting of a reservoir or multiple geologically related reservoirs.
Flaring
The burning of natural gas for safety reasons or when there is no way to transport the gas to market. In Wyoming, an operator is allowed to flare up to 60,000 cubic feet per day under WOGCC regulations and must obtain a permit to exceed that limit.
Formation
A rock unit that is distinctive enough in appearance that it can be identified separately from the surrounding rock layers.
Fossil Fuel
A fuel source (such as oil, condensate, natural gas, natural gas liquids or coal) formed in the earth from plant or animal remains.
H
Horizontal Drilling
A type of directional drilling that approaches +/- 90 degrees from vertical in an effort to produce hydrocarbons from a number of areas at the same approximate depth. Horizontal drilling can often reduce the number of wells required to develop a field, thereby minimizing surface disturbance.
Hydraulic Fracturing
A completion technique used in tight geologic formations to better access oil and gas reserves. The process involves pumping fluid, made up of mostly water and sand, into the target formation, creating small fractures in the rock that enable hydrocarbons to flow to the wellbore.
Hydrocarbons
A compound of hydrogen and carbon, such as any of those which are the chief components of petroleum and natural gas.
I
Infill Well
Wells drilled into the same reservoir as producing wells to improve recovery.
Injection Well
A well that places fluid deep underground into porous rock formations, such as sandstone or limestone. Often used for the disposal of produced water.
In-situ Recovery
A process used to extract hydrocarbons from deposits of extra-heavy crude oil, bitumen or oil shale without removing the soil and other overburden materials.
L
Lease
A legal instrument by which working interest is created in minerals for a certain amount of time in a specific area.
Liquified Natural Gas (LNG)
Natural gas that has been cooled down to liquid form for ease and safety of non-pressurized storage or transport.
M
MCF
Thousand Cubic Feet — the standard unit for measuring the volume of natural gas.
Midstream
Activities in the oil and gas industry which take place between the source of supply and downstream activities, such as the safe storage and transportation of oil and gas.
Migration Corridor
A route followed by animals, birds, or fish when traveling between winter and summer habitat ranges.
N
Natural Gas
Naturally occurring hydrocarbons, predominantly methane, which at atmospheric conditions of temperature and pressure, are in a gaseous phase.
O
Oil Sands
A deposit of loose sand or partially consolidated sandstone containing petroleum or other hydrocarbons.
Operator
The company responsible for managing operations in a field.
P
PAW
The Petroleum Association of Wyoming — the voice of the oil and gas industry in the state.
Permeability
A measure of the resistance to the flow of fluid through the rock. High permeability means fluid passes through the rock easily.
Pipeline
A method of safely and efficiently transporting oil or natural gas from the source of supply to final destination through a network of gathering and transmission pipes.
Play
A group of oil fields or prospects in the same region that are controlled by the same set of geological circumstances.
Plugging of Well
The sealing off of the fluids in the stratum penetrated by a well so that the fluid from one stratum will not escape into another or to the surface.
Porosity
The measure of a rock's ability to hold a fluid — the ratio, expressed as a percentage, of the volume of the pores of a substance to the total volume of the mass.
Produced Water
Water produced in connection with oil and natural gas exploration and development activities.
Productive Well
A well that produces oil or gas in quantities that make it economically viable.
Proven Reserves
Oil or gas still underground, but which has been located and determined to be recoverable.
Pumpjack
The overground drive for a reciprocating piston pump in an oil well. Used to mechanically lift liquid out of the well if not enough bottom hole pressure exists for the liquid to flow to the surface.
R
Recompletion
The process of entering an existing well and performing work designed to establish production in a new zone.
Refinery
A facility where produced hydrocarbons are refined into usable products such as gasoline, asphalt base and fuel oils.
Reserves
Estimated remaining quantities of oil and gas and related substances anticipated to be economically viable to produce.
Reservoir
A porous and permeable sedimentary rock containing commercial quantities of oil and gas.
Rig
See Drilling Rig.
Roughneck
Drill crew members who work on the derrick floor, screwing together the sections of drillpipe when running or pulling a drillstring.
Roustabout
Drill crew members who handle the loading and unloading of equipment and assist in general operations around the rig.
Royalty
A landowner's share of production, before the expenses of production.
S
Severance Tax
A tax on the removal of minerals from the ground. In Wyoming, the severance tax on oil and gas is 6% of fair market value.
Shale
Soft, finely stratified sedimentary rock formed from consolidated mud or clay, often containing large amounts of oil and gas.
Shut In
The process of closing down a producing well temporarily for repairs, cleaning out, building up reservoir pressure, lack of market, etc.
Sour Gas
Natural gas or any other gas containing significant amounts of hydrogen sulfide (H2S) which cause foul odors.
Spacing
The distance between wells producing from the same reservoir, determined by the Wyoming Oil and Gas Conservation Commission.
Spudding In
The first boring of the hole in the drilling of an oil well.
Sweet Gas
Natural gas that contains little or no hydrogen sulfide.
U
Tight Gas
Natural gas produced from relatively impermeable rock. Production in tight gas formations usually requires enhanced technology applications like hydraulic fracturing.
Unconventional Reservoirs
Reservoirs with low permeability (generally less than 0.1 millidarcy) requiring the use of hydraulic fracturing to produce at economically viable rates.
Unit
The joining of interests in a reservoir or field to provide for development and operations without regard to separate property interests.
Upstream
Activities in the oil and gas industry which take place close to the supply — including exploration and production activities.
W
Well
A hole drilled in the earth for the purpose of finding or producing crude oil or natural gas.
Wellbore
See Well.
Wellhead
See Christmas Tree.
Wet Gas
Produced gas that contains natural gas liquids.
Wildcat Well
An exploratory well drilled in unproven territory.
Work Over
A process used on a producing well to restore or increase production.
Wyoming Oil and Gas Conservation Commission (WOGCC)
The WOGCC is the regulatory body in Wyoming charged with overseeing oil and gas operations as outlined by Title 30, Chapter 5 of Wyoming State Statutes.
Wyoming State Geological Survey (WSGS)
The WSGS is tasked with promoting the beneficial and responsible development and use of Wyoming's geologic, mineral and energy resources while seeking to understand, characterize and inform the public about geologic hazards.