Drilling: Part 1 History of Drilling - Drilling Today - Drilling Contracts

1. Chapter 4 Drilling: Part 1History of Drilling - Drilling Today - Drilling Contracts

2. Drilling • Part 1 • History of Drilling • Drakes Well • Cable Tool Drilling • Rotary Drilling • Drilling Today • Drilling Contracts

3. History of Drilling • 1857: James M. Townsend was a New Haven banker and the president of Pennsylvania Rock Oil Company • Company leased oil rights to an island that lay in Oil Creek – a mile south of Titusville, PA. • Oil Creek – Oil seep that produced very small amounts of oil. • At this time oil was called “Rock Oil” • Rock Oil was becoming more valuable as a lubricant and illuminant due to massive shortages in whale oil.

4. History of Drilling • Townsend proposed that the company drill for oil as others had drilled for brine (salt water) • Townsend went looking for someone to supervise a drilling operation in Titusville • He found: Edwin L. Drake an unemployed railroad conducter

5. Drake’s Well • Carried on for two years: • Could not find a driller, Brine drilling companies did not want to give up there rigs for exploratory work • When they started, the cellar (hand dug top soil portion of the well) kept caving in due to ground water filling it up before the driller could reach bedrock. • Drake solved the problem by having his drilling team (a Blacksmith named Billy Smith and his son) hammer steel pipe into the ground (Casing) until they hit bedrock.

6. Drake’s Well Drake really started drilling by April 1859, by August 1859 Townsend called it quits having sent a letter by stagecoach to Drake instructing him to abandon the well. One afternoon before the letter had arrived Billy Smith went to check on the wells progress and found oil in the well bore. It was 69 feet deep.

7. Cable-Tool Drilling Used from the 1860’s to the 1920’s regularly Portable cable-tool rigs became popular up till 1950. After this rotary drilling replaced most of it.

8. Portable Cable-Tool Rig http://www.youtube.com/watch?v=YZMKLYOu7jI&feature=related

9. Rotary Drilling History • Developed originally in France in the 1860’s • It did not catch on at first because drilling companies believed petroleum only lay in hard formations where cable-tool drilling was the norm. • In the 1880’s two brothers named Baker gained a reputation for drilling successful water wells in the soft formations of the Great Plains in the United States. • The rig they used was a rotary unit with a fluid circulating system. • This system proved equally successful in the soft unconsolidated rocks of Texas in the Corsicana oilfield (which was discovered while drilling for water)

10. Rotary Drilling History • Spindletop: • In 1900 several unsuccessful attempts to drill the great Lucas well at Spindletop (near Beaumont, TX) provided the proving ground for rotary drilling. • Anthony Lucas an Austrian-born Mining Engineer believed there was oil under the dome of Spindletop. He set out to use rotary drilling to find it. • Historians estimate that between 80,000 and 100,000 barrels of oil per day gushed from the well in the first nine days. (1 barrel = 42 gallons) 336,000-420,000 gal/day.

11. Spindletop

12. Spindletop Boiler Avenue in Spindletop, TX By 1903 over 400 wells had been drilled Population rose in Beaumont from 10,000 to 50,000

13. Rotary Drilling The action of rotating the drill bit with the application of pumping fluid (Mud) through the drill string, drill bit, and annular to remove cuttings.

14. Drilling Today

15. Drilling Contracts • Operator: Oil Company • Drilling Contractor: Company hired to drill the well • Company Representative: Operating company person on the rig/site at all times to supervise and monitor operations

16. Drilling Contractor • The Drilling Contractor: • Tool Pusher: Contractors top manager on the drill site. Responsible for the rigs overall operation and adherence to the operators specifications. • Driller: is subordinate to only the tool pusher and is the one person who actually operates the rig. Also manages the day to day activities of the derrickhand and floormen. • Derrickhand: two jobs- Monitors and records the condition of the drilling mud, when the drill pipe is being removed from or put into the hole they handle the top of the pipe from a small platform high in the derrick or mast of the rig. • Floormen: handle the bottom of the pipe on the rig floor when pipe is being removed from or put into the hole. Other times they repair and maintain equipment on the rig. • Roustabouts: (Offshore) assist in the loading and unloading of equipment and supplies that a boat brings to the rig. Also responsible for cleaning, painting and repairing the rig.

17. Drilling Contracts • Bid Proposals and Specifications • Agreement between the operator and the drilling company that begins the process of drilling a well. • Specifications: one of the most important parts of the contract: • Diameter and depth of each part of the hole • The drilling muds to be used • The equipment and services each party will furnish

18. Drilling Contracts • Four types: • Footage Contract: Operator pays the drilling company a certain amount for each foot drilled. • Riskier for the contractor due to any unforeseen down time the rig may have. • Daywork: Operator pays a daily rate for use of the rig regardless of what work the rig is performing. • Rates are typically adjusted for the type of work being performed • Turnkey: Operator agrees to pay contractor a set amount upon completion of the well. Drilling contractor assumes all risk and responsibility of the well site and has no operator supervision onsite. • Typically awarded to companies the operator has worked with closely over time. • Combination Agreements: A combination of Daywork and Footage contracts that stipulate when each type is used for certain operations.