Example 5.1 Economic Analysis.

Total rotating time = 212.5 hr

Total trip time = 54.3 hr
Rig operating cost = $300/hr
Total bit cost = $16,148
Total footage = 3,380 ft
Note: Tripping rate is computed at 1,000-ft/hr average. This rate will vary, depending on
rig type and operation. Therefore, the offset cost per foot for this interval (8,862 to 12,242
ft)
is calculated with the standard cost-per-foot equation:
C = R(t + td) + Cb / F,
where C = drilling cost per foot ($/ft), R = rig operating cost (plus add-on equipment, such
as
downhole motor) ($/hr), t = trip time (hr), td = drilling time (hr), Cb = bit cost ($), and F =
footage drilled (ft).
From the data provided in the example above, the cost per foot is
C = 300(212.5 + 54.3) + 16,148 / 3,380 = 28.46 ft / hr.
In determinations of whether an application is suitable for a bit, the offset performances are
given, but bit performance must be estimated. Thus, we must assume either the footage the
bit
will drill or the ROP it will obtain. If the footage is assumed, then we use the following
equation
to calculate the break-even ROP:
Breakeven ROP = Cr / Co(Rt + Cb) / F,
where Cr = rig operating cost ($/hr), Co = offset cost per foot ($), t = trip time of bit (hr), Cb
= bit cost ($), and F = assumed bit footage (ft). Therefore, in the above example,
Breakeven ROP = 300 / {28.46 (300 12) + 18,300 } / 3,380 = 13.7 ft / hr.
The bit must drill the 3,380 ft at an ROP of 13.7 ft/hr to equal the offset cost per foot of
$28.46 for the same 3,380 ft.
If an ROP is assumed, use the following equation to calculate the breakeven footage:
Breakeven footage = (Cr t) + Cb / Co (r / ROP) .
Thus, in the above example, if we assume an ROP of 20 ft/hr, we have
Breakeven footage = (300 12) + 18,300 / 28.46(300 / 20) = 1,627 ft.
In this case, the bit must drill 1,627 ft to attain the breakeven point.