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      Terms / concepts that you should familiarize yourself with before investing.

      Oil and Gas Terminology
      Glossary of common oil and gas terms and definitions will aid newcomers as well as experienced royalty owners or mineral owners with the terminology used in the Oil and Gas industry. These are some of the most commonly used oil and gas terms.

      Bbl, Barrel – In the oil and gas industry, a barrel is 42 U.S. gallons measured at 60º Fahrenheit.
      BCF– The abbreviation for billion cubic feet of gas.
      BHP, Bottom Hole Pressure – The abbreviation for bottom-hole pressure
      BP, Blowout Preventor – Casinghead equipment that prevents the uncontrolled flow of oil, gas and mud from the well by closing around the drill pipe or sealing the hole.
      BS&W, Basic Sediment and Water – Impurities and water contained in the raw fluid produced by an oil well.
      BTU, British Thermal Unit — The amount of heat required to raise the temperature of one pound of water one degree Fahrenheit under standard conditions of pressure and temperature.
      CO2 – Abbreviation for carbon dioxide.
      D&A – Dry and abandoned. Refers to oil and gas wells.
      GOR, Gas Oil Ratio – Number of cubic feet of gas produced per barrel of oil.
      LACT Unit, Lease Automatic Custody Transfer Unit, – A system providing for the automatic measurement, sampling, and transfer of oil from the lease location into a pipeline.
      MMBtu – One million British thermal units; a measurement of heating value.
      MMcf – One million cubic feet; a measurement of gas volume only.
      NGL, Natural Gas Liquids – Gas that is processed through a plant to separate the heavier hydrocarbon liquids from the natural gas stream. These heavier hydrocarbon liquids, NGLs, traditionally have a higher value than the gaseous natural stream.
      NRI, Net Revenue Interest – An owner’s interest in the revenues of a well.
      OGML, Oil, Gas, and Mineral Lease – The agreement outlining the basic terms of developing lands or minerals such as royalty to be paid, length of time, description of lands.
      P&A – Plugging and abandoning a well. After a well’s productive life, it is usually plugged and abandoned with cement and heavy mud. The wellhead is removed, and the casing cut off 3-6 feet underground, and a steel plate welded over the top.
      SWD, Salt Water Disposal Well – Well used for disposal of saltwater into an underground formation.
      WI, Working Interest– Interest(s) in a well which bears the drilling and operating expenses.
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