Comprehensive Approach to Oil Well Drilling Cost Estimation

Abstract

The comprehensive approach to oil well drilling cost estimation was presented. A formular was derived from the existing drilling cost estimation formulae that considered a parameter known as host community cost (HCC), which was introduced into the existing formula to make it more comprehensive. The host community cost included; cost of acquiring the location, cost of provision of basic amenities, cost of access road to the location, and cost of settlement of unrest within the community. An excel spreadsheet was also developed based on the comprehensive formular that can estimate the drilling cost. It was discovered that the comprehensive formular if adopted provides room for the effective implementation of the drilling program, helps in rural development, improves host community versus company relationship and finally saves time and cost.

Keywords: rotary drilling, oil rig, oil well, drill bit, cost estimation, host community, excel spreadsheet, basic amenities