The petroleum industry Includes three main sectors. The upstream sector includes exploration and production, seismic, drilling, and service/supply/manufacturing. The second sector is referred to as the midstream sector and includes pipeline, storage, distribution, and some processing. Last, the third sector is downstream and includes refining and processing. These three sectors are vertically integrated and depicted in Exhibit 2.1. Many of the larger companies are fully integrated, including all three sectors in their core business.
2.4 Vertical Integration