Recently, CNN announced that North America could produce an additional 10 million barrels of oil a day by 2030, creating 1.4 million jobs and $800 billion in tax revenue. However, when it comes to oil, the cost of drilling is never small.
One reason oil drilling is expensive is because it requires skilled technical workers including: structural engineers, architects, scientists and geologists. It takes a team of multiple people to complete the job and because of the high risk of oil drilling, the more experienced the worker, the better. For more information about the people behind oil drilling, see our blog post.
Another cost to consider is the equipment. According to Hubpages, the oil rig has to be designed to meet the geographical characteristics. There are rigs designed for penetrating ocean floors as well as land based rigs and the machinery used are not applicable to other oil drilling ventures, increasing the cost of drilling crude oil.
Before any drilling can take place, all dues with the landowner must be cleared, and taxes, an attorney, and the permit to drill the well must be paid. Because the duration of the drilling can vary, amenities must be made for everyone who is employed. This includes places to live, restaurants, transportation, water, and food.
The cost of a well depends mainly on the daily rate of the drilling rig, the extra services required to drill the well and the duration of the well program. For more information, check out the Preferred Personnel website and LIKE our Facebook page!