How the Upstream Oil and Gas Process Works (Step-by-Step Guide)

The upstream oil and gas process covers every step between extracting hydrocarbons from underground reservoirs and delivering them as market-ready crude oil, condensates, or natural gas. It’s a vital stage in the energy supply chain, where precision, safety, and environmental compliance all come together.

To make this easier to understand, we’ll look at a real example: the Statoil Njord floating production platform in the North Sea.

Gathering Production from the Wells

On offshore platforms such as Njord, the production process begins at the wellhead, a seabed facility outfitted with a Christmas tree structure of valves and a choke that limits output. The mixed fluids are then sent up through production risers to the platform’s topside processing facilities.

Once on the platform, the flow enters manifolds pipe systems that direct the mixture into different processing routes. These can include:

• High Pressure (HP) manifold for wells with strong natural pressure.
  
• Low Pressure (LP) manifold for declining wells.
  
• Test manifold for performance checks and diagnostics.

Key challenge: Operators may encounter an issue known as slugging, which refers to erratic surges of liquid and gas moving through the pipeline. These slugs can disrupt the flow and slow the separation process. To solve the problem, engineers may manually fine-tune the choke settings or employ automated slug control systems.

The Separation Stages

The wells discharge a mixture of oil, gas, water, and, on occasion, sand or other pollutants. The separation operation separates the mixture into isolated, purified streams that can be reused or processed further.

a) Test Separators

Test separators isolate the flow from one or more wells so engineers can measure production rates, gas-oil ratios, and water content. This data helps plan production strategies and detect problems early.

b) Multi-Stage Production Separators

Njord uses three main stages of separation:

1. First Stage Separator (High Pressure)
   
   • Reduces pressure to about 3–5 MPa.
     
   • Capable of processing high water content about 40% on the Njord facility and lowering it to less than 5%.
     
   • Slug catchers and demisters are installed to provide a consistent, smooth output.
     
2. Second Stage Separator (Low Pressure)
   
   • Operates at about 1 MPa.
     
   • Further reduces water content to under 2%.
     
   • May include heating to improve oil-water separation.
     
3. Third Stage Separator (Flash Drum)
   
   • Brings pressure near atmospheric levels.
     
   • Removes the last heavy gas components before oil polishing.

Final Oil Treatment

Even after three separation stages, traces of water and salts may remain. The final steps ensure oil meets export quality:

• Coalescer: Breaks oil-water emulsions and removes water to as low as 0.1%.
  
• Electrostatic Desalter (if required): Removes salts such as sodium chloride that can cause corrosion or processing problems downstream.

Produced Water Treatment

High water production is common in mature fields. With Njord’s 40% water cut, that’s thousands of cubic meters daily. Environmental rules, like the OSPAR convention in the North Atlantic, limit oil in discharged water to 40 mg/liter.

A typical treatment process includes:

1. Sand cyclone – removes solids like sand from the water stream.
   
2. Hydro cyclone – uses centrifugal force to spin out oil droplets.
   
3. Degassing drum – lets remaining gas escape, carrying fine oil droplets to the surface for removal.

Recovered oil from this process is recycled into the main separation system, and treated water is safely discharged.

Why the Upstream Process Matters

The upstream oil and gas process follows a precisely designed series of steps that aim to ensure:

• Maximum recovery from the reservoir.
  
• Product quality for downstream refining.
  
• Safety in handling high pressures and volatile fluids.
  
• Environmental compliance through effective water treatment.

The Njord floater shows how a medium-sized offshore facility balances production efficiency, environmental responsibility, and operational safety principles that apply across the global oil and gas industry.

Gas Compression Process in Offshore Oil and Gas Production

After the separation stages, the gas compression process in offshore oil and gas production ensures that the separated gas reaches the required pressure for export or reinjection. Using multi-stage compressors, scrubbers, and coolers, offshore platforms safely move gas through pipelines while minimizing flaring and maintaining steady production efficiency.