The average daily production output of a new well over its first 120 days. Operators use this benchmark to schedule and extend field service contracts. Strong IP120 results often trigger follow-on work for completions and production crews.
Industry Glossary Term
Ip120 (initial Production 120-Day Rate)
Guides on this topic
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What Is an AFE in Oil and Gas and How Does It Affect Subcontractor Payments?
An AFE (Authorization for Expenditure) controls every dollar spent on an oilfield project. Learn how it affects your billing, change orders, and cash flow as a subcontractor.
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Promoting your best hand to foreman is one of the most important decisions a subcontractor makes. Get it wrong and you lose two people: a skilled producer and a failed supervisor. This guide covers how to identify the right candidates, make the transition, and build a leadership pipeline that does not gut your field capacity.
Related Terms
Frontier Exploration
IndustryExploration activity conducted in remote, undeveloped, or previously unworked regions where subcontractors can expect longer mobilisation lead times, higher logistical costs, and limited access to local supply chains or support infrastructure.
Subcontractor
IndustryA company hired by a general contractor or directly by an operator to perform a specific portion of work. Subcontractors often specialize in particular services or trades.
AFE (Authorization for Expenditure)
IndustryA budgeting document used in oil and gas projects that outlines expected costs and seeks approval before work begins. Subcontractors often work under AFEs issued by operators.
Offtake Agreement
IndustryA long-term contract where a buyer commits to purchasing a set volume of product from a producer. For subcontractors, these agreements signal stable, ongoing site activity and sustained demand for field services. They often underpin project financing, making worksites more financially secure for service providers.
Drillship
IndustryA self-propelled vessel equipped with a drilling rig used for offshore exploration and production in deepwater locations, which subcontractors may be mobilised to for specialised services such as equipment maintenance, inspection, or crew support under strict offshore safety and logistical requirements.
Reactivation
IndustryThe process of bringing a dormant well, pipeline, or piece of equipment back into active service, often requiring subcontractors to mobilise crews, conduct inspections, and complete compliance checks before full operations can resume. For field service companies, reactivation work can represent a significant surge in contract opportunities, particularly during periods of rising commodity prices.
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