The ABCs of Oil

It’s Petroleum

Petroleum is the fuel that makes our country go! Petroleum is made of hydrocarbon molecules (hydrogen and carbon atoms bound together). “Petra” = rock, “oleum” = oil

It’s Our Major Source of Energy

Petroleum supplies about 45 percent of our total energy requirements.

It’s an Essential Raw Material

A basic ingredient in more than 6,000 products we use every day.

It’s Used in Many Forms For:

Transportation: to fuel cars, trucks, trains, planes, etc.

Heating: to warm homes, schools, offices, factories, etc.

Electricity: to power many electrical generators.

Lubrication: to make machines run smoothly and safely.

What is Oil?

Oil, or petroleum, is a naturally occurring substance made up of a mixture of hydrogen and carbon compounds. Hydrocarbons occur as liquids, gases or solids.

How is petroleum created?

Petroleum originated from marine plants and animals that decayed over time under ocean silt, sand or other materials. Millions of years, extreme pressure and heat transformed the material into petroleum.

When was the first oil well discovered?

In 1859 in Titusville, Pennsylvania, Col. Edwin Drake drilled the first oil well. The discovery at 69.5 feet in the Oil Creek formation was significant in that it demonstrated the practicality in drilling.

When did Arkansas get involved in oil and natural gas?

The first natural gas well was drilled in Arkansas in 1889. Oil was discovered in Union County in 1921.

Are we running out of oil?

Fossil fuels supply almost 95 percent of the world’s energy, even though hydro, nuclear and geothermal energy use has tripled since 1970. According to American Petroleum Institute statistics, world proven oil reserves are estimated at well over 1 trillion barrels, enough to last almost 50 years at current rates of consumption. In fact, for many years, on average, more oil has been discovered than has been used, so proven reserves today are the largest they have ever been.

What about our environment here in The Natural State?

The oil and natural gas industry spends more than $10 billion annually to protect the environment worldwide. That’s as much as the top 300 oil and natural gas companies earn in profits and more than the entire industry spends searching for oil and natural gas in the United States. In Arkansas, most of the natural gas exploration companies in the Fayetteville Shale area pledged to landowners that they would return their land to the same or better condition after a well(s) is drilled. Many have gone above and beyond to even make operating well areas clean, streamlined and as unobtrusive as possible.

What about regulation of the oil and gas industry?

As a state we have led the way in regulation of the industry. In fact, Arkansas was one of the first states to pass a law to require public disclosure of the contents of hydraulic fracturing fluid used in each well. This information is available through the Arkansas Oil & Gas Commission website. In the state of Arkansas, the industry reports to three different regulatory agencies – the AOGC, the Arkansas Department of Environmental Quality and the Arkansas Natural Resources Commission.

How is petroleum used?

Much of our high standard of living can be traced to the use of petroleum. Thousands of products are produced from petroleum including many types of transportation fuels, industrial fuels and chemicals, residential fuels, lubricants, waxes, asphalt, fertilizers, pesticides, photographic film, plastics and medicine.

Are oil and natural gas important to Arkansas?

Oil and natural gas combined are one of Arkansas’ top industries. Starting in 2007, the market value of oil and natural gas produced in the state exceeded that of rice, cotton and soybeans COMBINED. That has held true through the last six years. Each day, 18,000 barrels of oil and 3 billion cubic feet of natural gas are produced from nearly 16,000 wells in just 25 of our state’s 75 counties. The oil and natural gas industry is also one of the state’s largest employers, employing more than 33,000 people with an average annual salary of $75,000 – more than double the state average. And income to the state just through severance taxes on oil and natural gas reached $324 million between 2009-2012.

How is petroleum made into usable products?

Before petroleum can be used, it must go through a process called refining. Through refining, oil is heated until it separates into many different parts. These parts are then used to make products like gasoline, jet fuel, heating fuel, tar and plastics. Natural gas is much easier to refine. It is cleaned and then a harmless odor, called mercaptan, is added for safety reasons.

What nonrenewable energy source is abundant in Arkansas?

Petroleum (oil and natural gas) is considered a nonrenewable energy source because it takes millions of years to form. Today, Arkansas ranks as the 8th leading natural gas producing state in the country and the 17th leading oil producing state. We produce oil and gas in 25 of our 75 counties.