Upstream activities refer to the early stages of the oil and gas production process, including exploration, drilling, and well completion. These activities involve finding and identifying potential oil and gas reserves, drilling wells to extract the resources, and preparing the wells for production. Upstream activities can include both onshore and offshore operations, and can also include activities such as seismic surveys and testing of potential drilling locations. The upstream sector also includes the transportation and storage of crude oil and natural gas, as well as the marketing and trading of these commodities. Upstream activities can be capital-intensive and carry a high level of risk, but they are essential for the production of oil and gas.
Downstream activities refer to the later stages of the oil and gas production process, including refining, marketing, and distribution of the resources. These activities involve processing raw oil and gas into usable products such as gasoline, diesel, and other petrochemical products. Downstream activities can include refining crude oil into various products, such as gasoline and diesel, as well as the distribution of these products through pipelines, tankers, and other means to terminals, refineries, and retail outlets. Downstream activities also include the manufacturing and distribution of petrochemical products, such as plastics, fertilizers, and other industrial chemicals. These activities typically require large capital investments in facilities and infrastructure, but they tend to have lower risks and can be more stable than upstream activities.