Page 307 - Drilling Technology in Nontechnical Language

298 Drilling Technology in Nontechnical Language Second Edition

Fig. 12–4. Contingency cost estimate

For the final total estimated cost, all of the previously mentioned
categories are added up. This is felt to be the likely cost. To arrive at the
maximum cost, the total is multiplied by the accuracy factor. For a total of
$5,000,000 and an accuracy of 10%, the maximum cost of the well should
not exceed $5,500,000. This is the amount that the AFE should approve
(fig. 12–5).

Logistics

Logistics is the art and science of getting people and materials to the
rig and back again afterwards. Without effective logistics, the well will not
get drilled. Logistical problems increase with the distance from the point
of supply and with the remoteness of the location. Some special situations,
such as in remote mountainous or heavily forested areas, might mandate
the use of a rig that is totally moved and supplied by helicopter.
As well as moving supplies, their whereabouts must be monitored.
Many drilling operations (if not all) now use computerized inventory and
monitoring systems that allow close tracking to be maintained.

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