Introduction:

World natural gas consumption that was around 75 trillion cubic feet (tcf) in the year 1994 is increasing faster than that of any other fossil fuel. The increase is as an outcome of increase in gas demand for industrial and power generation, in heating of buildings and homes in the design, and operation of gas turbines.

Petroleum Industry:

The petroleum industry is generally categorized into three main components: Upstream, midstream and downstream. Midstream operations are generally comprised in the downstream category.

Upstream:                                                             

The upstream oil sector is a word generally employed to refer to the searching for and the recovery and production of crude oil and natural gas.

The upstream oil sector is as well termed as the exploration and production (E&P) sector. It comprises the searching for potential underground or underwater oil and gas fields, drilling of exploratory wells, and afterward operating the wells which recover and bring the crude oil and/or raw natural gas to the surface.

The upstream oil industry is the single most significant sector in the country's financial system, giving over 90% of its net exports.

Downstream:

The downstream oil sector is a word generally employed to refer to the refining of crude oil, selling and distribution of the natural gas and products derived from crude oil. These products comprise liquefied petroleum gas (LPG), gasoline or petrol, jet fuel, diesel oil, other fuel oils, asphalt and petroleum coke. It as well comprises oil refineries, petrochemical plants, petroleum product distribution, retail outlets and natural gas distribution companies. The downstream industry touches consumers via thousands of products like diesel, petrol, jet fuel, heating oil, asphalt, lubricants, synthetic rubber, plastics, fertilizers, pesticides, antifreeze, pharmaceuticals, natural gas and propane.

Oil Tanker:

An oil tanker, as well termed as a petroleum tanker, is a ship designed for the bulk transport of oil. There are two fundamental kinds of oil tankers: the crude tanker and the product tanker. Crude tankers move big quantities of unrefined crude oil from its point of extraction to refineries. Product tankers, usually much smaller, are designed to move petrochemicals from refineries to points close to consuming markets.

Oil tankers are often categorized by their size and also their occupation. The size classes range from inland or coastal tankers of a few thousand metric tons of deadweight (DWT) to the mammoth tanker of 550,000 DWT. Tankers move around 2,000,000,000 metric tons (2.2046 x 10⁹ short tons) of oil each and every year. Second only to pipelines in  terms  of  efficiency,  the  average  cost  of  oil  transport  through tanker amounts to just two or three United  States cents per 1 US gallon (3.8 L).

A few specialized kinds of oil tankers have evolved. One of such is the naval replenishment oiler, a tanker that can fuel a moving vessel. Combination ore-bulk-oil carriers and permanently moored floating storage units are two other variations on the standard oil tanker design. Oil tankers have been comprised in a number of damaging and high- profile oil spills. As an outcome, they are subject to stringent design and operational regulations.

Pipeline Transport:

Pipeline transport is the transportation of goods via a pipe. Dmitri Mendeleev first recommended by employing a pipe for transporting petroleum in the year 1863. Most generally, liquid and gases are sent, however pneumatic tubes which transport solid capsules employing compressed air have as well been employed.

As for liquids and gases, any chemically stable substance can be sent via a pipeline. Thus, sewage, slurry, water or even beer pipelines exist, however arguably the most valuable are such transporting fuels, oil, natural gas (that is, gas grid) and biofuels.

Political Activity and Civil unrest:

The issue at the basis of most civil conflict is the equitable sharing of the country's yearly oil revenues among its population and the question of the ecological responsibilities of the oil multinationals. However all multinationals have been targeted in the disputes, Shell has been the key target.

World Natural Gas distribution and production:

As is the case with oil, natural gas is unevenly distributed all through the world. More than one-third of the world's original gas endowment was in the territory of the former Soviet Union. The second biggest gas resource, positioned in the Middle East, comprised around 22% of the world total. A few 17% of the world's original recoverable gas was positioned in North America. Though, North America has accounted for more than one-half of the world's gas production and now includes only 11% of the world's remaining gas resources. Around 38% of the world's remaining gas is in the former Soviet Union and 25% is positioned in the Middle East. South America, Europe, Africa and Asia/Oceania are each projected to have less than 10% of the remaining world's natural gas.

Therefore, the world distribution of natural gas mirrors that of oil that may be anticipated as oil and gas are often produced and reservoir altogether. Though, the Middle East, however having a very important amount of gas, doesn't dominate world gas as it does world oil. The former USSR holds the dominant natural gas resource. As well, it is the world's leading gas producer; however its output is just slightly more than that of North America. North America generates a big amount of gas from a relatively small reserve. Its reserves/production (R/P) ratio of 12/1 contrasts by the 80/1 R/P ratio of the former USSR.

The R/P ratio is a measure of the rate of production of a proved gas reserve. Associated gas is generated all along with oil that can be proficiently recovered at a maximum R/P ratio of around 10/1. Non-associated gas, that is more volatile than oil, can be generated at faster rates at times as fast as an R/P ratio of 5/1. The average regional R/P ratios for intensively and proficiently developed natural gas provinces might range between 7/1 and 10/1. In common, the average R/P ratio of a gas province or a country is indicative of its growth maturity, for it will comprise of a combination of low R/P ratios in older depleting fields and higher R/P ratios in more lately developed fields. As, the larger fields are generally found early in the exploration cycle (due to their big size and anomalous geology), they will dominate and by depletion, tend to reduce the average R/P ratio. Any gas reserves which remain undeveloped or are not generated efficiently assist to increase average R/P ratios. The average R/P ratio much above 12/1 generally points out a gas province or country in which new important discoveries are being made and/or one in which gas development is not intensive or production is not optimized.

North America, and specifically the United States (having an R/P of 9/1), is an intensively developed and mature gas producing area. Russia having an R/P of 82/1 includes significantly larger gas reserves than does the United States, however its gas output is just 10% higher. The United Kingdom as well is intensively developed, producing gas at an R/P ratio of 9/1. Average European gas production is at an R/P ratio of 24/1, pointing out that substantial proved reserves remain. In Asia or Oceania, South America and Africa gas reserves are underdeveloped, having average R/P ratios ranging from 54/1 to 131/1. The Middle East, having its moderate gas output and enormous gas reserves, consists of an R/P of 409/1.

World Natural Gas consumption and trade:

The universal market for natural gas is much smaller as compare to oil as gas transport is hard and costly, because of relatively low energy content in relation to volume.  Presently, just around 16% of global gas production is internationally traded, having less than 4% of the trade accounted for through LNG. Despite of the high cost of gas transportation and the remote location of certain future supply areas, increasing international trade in natural gas is anticipated.

Global gas reserves are plentiful, however of an uneven distribution. The North American market is self sufficient in the natural gas; however gas is traded by the region. Canada is anticipated to remain a total exporter of gas to the United States. Substantial natural gas reserves are positioned in Europe. The gas trade in the region is extensive, having Norway and Netherlands the major sources. Europe, though, is and will increasingly become more dependent on gas imported from other areas. Its traditional foreign suppliers, the former Soviet Union (at 20% of demand) and Algeria (at 10%), are anticipated to increase their shares of the European gas market. Significant gas exporters in the Asia-Pacific areas are Malaysia, Indonesia, Brunei, and Australia, the gas being shipped as LNG to Japan, Taiwan and South Korea. The Middle East is the other significant supply center for natural gas. Abu Dhabi and Qatar deliver important volumes of LNG to the Asia-Pacific region and future exports could be sent to Europe and South Asia. Gas demand in Africa, South Asia and China are met up through domestic or regional supplies. Several gases are being traded in South America.

The United States uses around 2.4 tcf more natural gas per year than it generates. Germany imports even more gas as compare to the United States (2.6 tcf per year) and Japan slightly less (2.3 tcf per year). North America is the leading consumer of the natural gas, however as well is a leading producer. The former USSR region leads the world in gas production, and is second in consumption. Europe ranks 3rd in natural gas consumption but have to import 4.1 tcf per year. Asia/Oceania as well should import natural gas to satisfy the demand. The other areas are relatively minor producers and consumers of gas.

Compared to oil, just moderate amounts of natural gas are traded on world markets. The low density of gas makes it more costly to transport than oil. A part of pipe in oil service can hold 15 times more energy than whenever employed to transport high pressure gas. Therefore, gas pipelines  should  be  of  larger  diameter  to  a  given  energy  movement. Compression adds to the difference between the transportation costs of the two fuels. The oil pumping station employs energy to overcome the frictional losses; however a gas line needs a huge amount of energy to compress the gas prior to pipeline friction is even encountered.

Pipeline transportation is not for all time feasible due to the growing geographic distance between gas reserves and markets. Also, as potential political instabilities might influence long pipeline routes, importing countries might wish to diversify the supply sources. As natural gas can be piped in a gaseous state, it requires to be condensed (that is, liquefied) in order that adequate energy is packaged to be economically transported via ship. A complete liquefied natural gas (LNG) chain comprises of a liquefaction plant; low temperature, pressurized, transport ships and a regasification terminal. World LNG trade is presently around 60 million metric tons per year, a few 65% of which is imported by Japan. The other importers comprise France, Korea, Spain, Belgium, Taiwan and Italy.  Indonesia accounts for 39% of LNG exports, having Algeria in second place with 24%. The other exporters comprise Malaysia, Brunei, Australia, Abu Dhabi and Libya. The United States imports and exports around 1 million metric tons of LNG per year. No grassroots LNG project has been commissioned from the year 1989 because of intense competition with other fuels, notably oil (that is, the world price of which remains low).

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