2.1 An Overview of the O&G Sector
13
and the Komi Usinsk Accident, among others (Armiero & D’Alisa, 2012; Goodland,
2006; Okafor, 2007; Rone, 2003). However, there are other negative impacts created
by O&G companies that have been poorly reported (Devold, 2013).
Frequently, O&G social investment is used to compensate for or mitigate the
impacts of O&G activities in host communities and societies. In this sense, to understand social investment in the O&G sector, we must first understand the impacts of
O&G activities in host environments and communities, thus in the sub-section that
follows, I briefly explore O&G activities and their productive streams. These impacts
are elaborated on in Sect. 2.2.
2.1.1 O&G Project Cycles and Respective Activities
The O&G production and distribution chain is comprised of three main stages, known
as Upstream, Midstream and Downstream. Figure 2.1 briefly illustrates these stages
and corresponding major activities. Notably, there are divergent views on where
stream specific activities occur; this illustration is only one way of representing the
O&G value chain.
As illustrated in Fig. 2.1, the Upstream stage is also called the Exploration and
Production phase and it includes prospecting for hydrocarbon deposits by developing
onshore and offshore seismic and drilling activities. Both seismic and drilling activities take place before a field is finally selected (Devold, 2013). The duration and sites
of Exploration and Production activities are often short and transitory. In this sense,
any social investment developed within this phase of the O&G exploration would be
short-term, due to the uncertainty of significant hydrocarbon discovery.
The production phase occurs after the site has been selected and all facilities for
production and stabilisation of the fossil fuels have been implemented. A variety
of structures are used in offshore O&G production, which depend on the size of
Fig. 2.1 O&G production stages and corresponding major activities
13
and the Komi Usinsk Accident, among others (Armiero & D’Alisa, 2012; Goodland,
2006; Okafor, 2007; Rone, 2003). However, there are other negative impacts created
by O&G companies that have been poorly reported (Devold, 2013).
Frequently, O&G social investment is used to compensate for or mitigate the
impacts of O&G activities in host communities and societies. In this sense, to understand social investment in the O&G sector, we must first understand the impacts of
O&G activities in host environments and communities, thus in the sub-section that
follows, I briefly explore O&G activities and their productive streams. These impacts
are elaborated on in Sect. 2.2.
2.1.1 O&G Project Cycles and Respective Activities
The O&G production and distribution chain is comprised of three main stages, known
as Upstream, Midstream and Downstream. Figure 2.1 briefly illustrates these stages
and corresponding major activities. Notably, there are divergent views on where
stream specific activities occur; this illustration is only one way of representing the
O&G value chain.
As illustrated in Fig. 2.1, the Upstream stage is also called the Exploration and
Production phase and it includes prospecting for hydrocarbon deposits by developing
onshore and offshore seismic and drilling activities. Both seismic and drilling activities take place before a field is finally selected (Devold, 2013). The duration and sites
of Exploration and Production activities are often short and transitory. In this sense,
any social investment developed within this phase of the O&G exploration would be
short-term, due to the uncertainty of significant hydrocarbon discovery.
The production phase occurs after the site has been selected and all facilities for
production and stabilisation of the fossil fuels have been implemented. A variety
of structures are used in offshore O&G production, which depend on the size of
Fig. 2.1 O&G production stages and corresponding major activities