for the prime mover, or a total of $115 per horsepower. The additional 150 

 horsepower required for jet bits would thus necessitate an additional capital 

 investment of 150 X $150 or $17,250. Based on straight-line depreciation for 

 2000 operating days and 20-percent salvage value, the increase in depreciation 

 is $7-per-day. 



Summary of Costs 



To recapitulate, the additional daily costs incurred in operating jet bits 

 compared to conventional bits are as follows: 



Item Additional Rig Costs Per Day 



For Jet Drilling 



Pump $12.00 



Prime Mover 33.00 



Misc. Equipment 5.00 



Depreciation 7.00 



Total I57T00 



Thus, the five thousand foot drilling rig which would operate for $1000- 

 per-day when using conventional bits, would be expected to operate for $1057- 

 per-day when jet bit drilling. In addition, the jet bit itself would be priced at 

 a premium of $32 each. 



Profitability of Jet Bits 



In order to appraise jet bits from a profitability standpoint in a given well, 

 it is necessary to know the following information: 



(a) Performance of jet bits compared to conventional bits in penetration 

 rate. 



(b) Performance of jet bits compared to conventional bits in total footage 

 that can be drilled with each bit. 



(c) Rig operating cost with jet bits compared to conventional bits. 



PERSONNEL FACTORS 



The successful use of jet bits depends not only on adequate equipment 

 applied to favorable formations but also on proper training and attitude on the 

 part of the drilling-rig crews. If the personnel involved are competent and are 

 receptive to ideas that may improve the rig's performance, the chances of suc- 

 cessful use of jet bits will be greatly increased. Further, if prior training of the 

 rig crews and foreman can be conducted, better results will be realized. This 

 training should include discussion of the theory of operation and instruction in 



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