DEFINITION of 'Christmas tree (oil and gas)'
A vertical assembly of mechanical elements used in oil exploration and production in surface and underwater oil and gas wells, primarily for flow control. Its name is derived from its shape, which roughly resembles a Christmas tree.
BREAKING DOWN 'Christmas tree (oil and gas)'
The valves that comprise some of the "decorations" on the Christmas tree are opened when the oil or gas well is ready to produce, and the processing and storage facilities are ready to receive. Other "decorations" are devices that facilitate pressure relief, monitoring and chemical injection. In offshore drilling and extraction, the Christmas tree would onboard the topside. On land, it would be at the wellhead.