Post by Vivian Umeh

OIL & GAS TERMINOLOGY 101:

What does FID mean?

Ever heard someone say, “The project is still awaiting FID”?

Here’s what they mean.

FID stands for Final Investment Decision.

It’s the point where a company or its investors formally decide to commit the money needed to move a project forward.

Before reaching FID, the team typically assesses the project’s costs, technical feasibility, risks and expected returns.

Once the decision is made, the project can move into execution, subject to any remaining approvals and conditions.

Think of it this way:

Idea: We have a project in mind.

Evaluation: Can we afford it, and does it make business sense?

FID: We’ve decided to commit the investment.

Execution:Let’s get to work!

Easy way to remember it: FID = The decision to commit the investment.

Now, when you hear that an oil and gas project has reached FID, you’ll know why it’s a big deal.