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Learn
How to Talk Like an Oilman
Over
400 Oil and Gas and related investment terms defined
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Take-or-pay
contract - A (long-term) contract between a gas producer and
a gas purchaser, such as a pipeline transmission company.
Tank
bottoms - A mixture of oil, water, and other foreign matter
that collects in the bottoms of stock tanks and large crude storage
tanks and must be cleaned or pumped out on a regular basis.
Tanker
- An ocean going ship which hauls crude oil.
Tar
sand - A sandstone in which the spaces between grains are filled
with a highly viscous tar.
Tar
sands - Rocks (other than coal or oil shale) that contain highly
viscous hydrocarbons that are unrecoverable by primary production
methods.
Tax
preference items - Certain items of income, or special deductions
from gross income which are given favored treatment under Federal
tax law.
TCF
- Trillion cubic feet.
Tectonic
map - A geologic map showing the structure of the earth's crust.
Tender
- 1. A permit issued by a regulatory body for the transportation
of oil or gas. 2. A barge or small ship that serves as a supply
ship and/or storage facility for an offshore rig.
Tertiary
recovery - The recovery of oil that involves complex and very
expensive methods such as the injection of steam, chemicals, gases,
or heat, as compared to primary recovery, which involves depleting
a naturally flowing reservoir, or secondary recovery, which usually
involves repressuring or waterflooding.
Therm
- A measure of heat content. One therm equals 100,000 Btus.
Third
for a quarter Sometimes also known as a "quarter for a
third". A widely used arrangement for promoting an oil deal
to another party.
Tight
formation - A sedimentary layer of rock cemented together in
a manner that greatly hinders the flow of any gas through the rock.
Tight
hole - A well about which the operator keeps all information
secret.
Tight
sand - A formation with low permeability. Gas produced from
a formation so designated by the Federal Energy Regulatory Commission
qualifies for a higher market price.
Time
value of money - The concept that a dollar in hand today is
worth more than a dollar that will be received in some future year.
Title
- The combination of factors that, together, constitute legal
ownership of a property.
Tool
pusher - The supervisor of drilling rig operations.
Top
lease A (conditional) type of lease that may be granted by the
mineral-rights owner of a property while an pre-existing recorded
lease of that property is nearing expiration, but nonetheless is
still in effect. The top lease would become effective only if and
when the existing lease expires (or is terminated).
Total
depth (TD) - The maximum depth of a borehole.
Township
- A square tract of land six miles on a side, it consists of 36
sections of one square mile each.
Transfer
rule - When an interest in an oil and gas property already proven
to be capable of commercial production is transferred, the transferee
taxpayer is generally not entitled to percentage depletion, although
he may still be entitled to cost depletion, in computing his depletion
allowance deduction from gross income.
Trap
- A natural configuration of layers of rock where non-porous or
impermeable rocks acts as a barrier, blocking the natural upward
flow of hydrocarbons.
Trip
- Making a "trip" is the procedure of pulling the entire
string of drill pipe out of the borehole and then running the entire
length of drill pipe back in the hole.
Tubing
- Small diameter pipe, threaded at both ends, that is lowered into
a completed well. Oil and gas are produced through a string of tubing.
Turnkey
- A drilling contract that calls for a drilling contractor to
drill a well, for a fixed price, to a specified depth. The purpose
of drilling a well by turnkey contract may be related to the timing
of Federal income tax deductions. For income tax purposes, expenses
are deductible from gross income as they are incurred. When a turnkey
contract is entered into toward the end of the current tax year,
the drilling costs may be pre-paid at that time. The idea is to
give a working interest owner (or investor) in the well, the opportunity
to deduct the intangible drilling costs from his gross income in
the current tax year.
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