Oil & Gas Midstream
This logistical sector handles the transportation, processing, and storage of crude oil and natural gas moving from wells to refineries via pipelines, ships, and terminals.
Why it exists
Midstream exists to move, store, and process hydrocarbons between production fields and end markets.
Why it’s necessary
Without pipelines, storage, and processing plants, production volumes collapse due to bottlenecks and safety constraints.
Key components
Pipelines (oil, gas, NGLs)
Processing & fractionation plants
Storage terminals and export facilities
Compression and pump stations
How to evaluate businesses
Focus on contract structure (fee-based vs volume exposure), asset utilization, customer concentration, leverage, and maintenance capex. Stability and cash flow durability outweigh growth in most cases.
How the industry could be improved
Smarter routing systems, real-time flow optimization, methane detection, hydrogen-ready infrastructure, and digital twins for pipeline monitoring and safety.