Paper: Money Sources For Drilling And Production

When the money requirements for drilling and production for the petroleum industry are considered, the sums involved are indeed staggering. According to information compiled by a joint effort of the American Petroleum Institute, The Independent Petroleum Association of America and the Mid-Continent Oil and Gas Association, the average cost per well in 1953, including drilling, casing, tubing, and well head connections, but not including tanks, flow lines, separators, treaters or other surface equipment, was approximately $78,700 for wells drilled in the Texas portion of the Permian Basin. The average depth of wells in this area in 1953 was 5,400 feet. Since costs in general and also average depths have gone up since 1953, it seems reasonable to assume that the actual average cost per well at present is probably close to $90,000.