Originally published on LinkedIn: https://www.linkedin.com/pulse/what-coordinate-reference-systems-why-do-matter-rob-sterpin 
We all know that geospatial data is about location. Much of the oil and gas business is concerned with the location of assets on the surface, near the surface, or far underground—where to drill an exploratory hole; the location of a producing gas well; the size and shape of an underground gas reservoir; the distribution of natural gas pipeline components.
In all of these cases, the key thing is to be able to assign sets of numbers, called coordinates, to the elements of the asset’s geometry to define its exact location relative to the surface of the Earth.
To simplify the explanation, let’s suppose that you want to drill a hole in your desk. Now think of how you would locate where to drill as point within the space inside your office. You would first establish a reference frame to define the space, such as the intersection of two walls and the floor, and then you would measure the location of your hole relative to that reference frame… so many meters along the left wall, so many meters up from the floor, and so many meters out from the left wall. The list of the three numbers is the coordinates of the hole. The reference frame (the walls and the floor), the directions in which to measure, the order in which to interpret the coordinates, and whether to measure in meters or feet constitutes the Coordinate Reference System or CRS. Once you have a Coordinate Reference System (CRS), you immediately have a recipe to specify the coordinates, relative to that CRS, for any point in the room — any point to which the CRS applies.
Given a specific point, defined using a particular CRS, if you change the CRS you will get different coordinates and thus a different location. A collection of such points can define the path of the drill, or the shape of a reservoir, or the path of a pipeline. If there are three coordinates, we say the CRS is 3D (3 dimensional) as it specifies (like our room example above) a point in the 3 dimensional space we all inhabit.
Coordinate reference systems in the oil and gas business are essentially the same as this simple example, but they may also need to take into account the shape and motion of the earth. Many CRS have their reference frame attached to a special point on the earth, and include a local model of the earth’s surface in addition to a model of the earth as a whole. The shape of this local model may be determined by surface, satellite, or aerial survey methods.
Just defining the reference frame and surface may be a significant amount of work, but it is critical information for all subsequent measurements. Different reference surfaces may be used in different parts of the world to meet desired accuracy requirements. Each CRS makes use of many support components, just as the simple example above did with its reference frame (defined by the walls and floor of the room), the units of measure, and the ordering of the measurement values.
Many different CRS are used in the oil and gas business for a variety of reasons, of which positioning accuracy is only one. Other factors include the ease of use, and the conversion of existing data and maps which were collected and constructed using previously active CRS. A modern exploration company typically draws on a database of some thousands of CRS and supporting components, including datums, earth models, axes definitions, and coordinate systems.
Many of these CRS and support components have parameters (e.g. the equatorial radius of the earth), and ensuring that the right component and the right parameter values are used is crucial to ensuring that measured or computed coordinates refer to the right place on the earth. Errors can easily cost an exploration company tens or even hundeds of millions of dollars if a drill is placed in the wrong location, or the size and location of a reservoir is incorrectly understood.