It seems like refining of oil is often done far away from where the oil was initially captured and contained from the upstream source. Why?

This is not an engineering question is it?

  • 1
    $\begingroup$ no, not really . $\endgroup$
    – jsotola
    Commented Apr 26, 2022 at 3:51

1 Answer 1


Some places, like the North Slope of Alaska, are inhospitable to the construction of refineries. It is cheaper and more convenient in this case to transport the crude to a distant refinery via a pipeline.

Some wells by themselves do not produce enough crude oil to justify the construction of a dedicated refinery next door. In this case, it is far cheaper to run a pipeline or railroad cars from an entire field of wells to a distant refinery, where the crude can be economically fed into the process flow along with crude from a large number of other wells.

Refineries require intensive infrastructure development to support their operation. So even where the weather is not a barrier and flow from the wells is large, it is cheaper to transport the crude to an existing refinery and enlarge it if necessary to handle the extra product.

  • $\begingroup$ Good answer. An additional logistical factor might be that after the refining process you need separate containers for all the refined products (gasoline, diesel, intermediate prodcuts, etc.). $\endgroup$
    – Andrew
    Commented Apr 26, 2022 at 5:37

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