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Oilfield Glossary
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Oilfield Glossary

Oil and Gas Business   Oil and Gas Business
Exploration and production transactions between partners, governments and lease-holders require a common vocabulary. Expectations between parties, expiration dates and lease terms must be specified explicitly to carry out oil and gas ventures. Definitions within this discipline span a broad range of terms that are specific to the oil industry, ranging from abandonment costs to authority for expenditure, severance and working interest. All have been reviewed by technical experts in this field.



A
abandonment costs

AFE

assignment

authority for expenditure


B
back in

back-in

bid and study agreement

bonus consideration


C
carried working interest

communitization

concession

conveyance

cost oil


D
delay rental

division order


F
farmee

farmor

farmout

fee simple interest

fee-simple interest

foreign content


G
government take


H
HBP

held by production

horizontal severance


L
lessor royalty

licensing round

local content


M
marketing agreement

mineral interest

multiple service contract


N
net profits interest

net revenue interest

nonparticipating royalty

nonparticipating royalty interest


O
oil and gas lease

operating agreement

operating interest

operator

overriding royalty

overriding royalty interest


P
paid up lease

paid-up lease

participating interest

payout

pooling

preferential right to operate

preferential right to purchase

primary term

production bonus

production payment

production penalty

production service contract

production sharing contract

profit oil

proration unit


Q
quitclaim


R
relinquishment

right of first refusal

royalty

royalty interest


S
secondary term

severance

shut in royalty

shut-in royalty

spacing unit

surface interest


T
TEA

technical evaluation agreement

term lease

top lease


U
unitization


V
vertical severance


W
working interest