Directional Drilling


DEFINITION of 'Directional Drilling'

A drilling technique in which a well is bored at multiple angles. Directional drilling most often refers to drilling at non-vertical angles, including horizontally. It is used both to retrieve oil and natural gas buried underground, and is useful in situations in which the shape of the reservoir is abnormal. It is also used to adjust pressure created by gas in mines (degasification).

BREAKING DOWN 'Directional Drilling'

As a technique, directional drilling allows oil and gas well operators to approach a potentially productive area without the need for a well to be drilled directly above that area. A central site can service multiple well bores that reach multiple locations at non-vertical angles. This reduces the number of well facilities that must be built and maintained. Not needing to build new wells may also lead to the exploration of smaller reservoirs that would otherwise be uneconomical.

Early directional drilling involved pointing the drill bit at an angle other than vertical, resulting in a straight line away from the well. Modern drilling techniques allow the use of drill bits that can bend; allowing engineers to adjust the direction the well is drilled in to a certain degree. This can be accomplished through the use of hydraulic jets

Directional drilling is used in the development of mines in order to reduce the risk of potentially dangerous gas ruptures. In-mine drilling techniques allow companies to create bore holes far in advance of the mine face.

While the fundamental concepts of directional drilling date back to the 19th century, it has become a more popular technique as computer-aided technology has become more common. The angle of the drill bit being used to bored the well can be adjusted by a computer using GPS signals to pinpoint the location of an oil and gas field. Engineers create 3-D models of the field to determine the best location for the well, and the best approach for the bore to follow.

  1. Christmas tree (oil and gas)

    A vertical assembly of mechanical elements used in oil exploration ...
  2. Topside

    The upper part of an oil platform—above the water line—that ...
  3. FPSO (Floating Production Storage ...

    Acronym for Floating Production Storage and Offloading. FPSO ...
  4. Day rate (oil drilling)

    In oil production, a day rate is the amount a drilling contractor ...
  5. Exploration & Production - E&P

    An E&P company is known to be in a specific sector within ...
  6. Development Well

    A well drilled in a proven producing area for the production ...
Related Articles
  1. Investing

    There Are More Ways To Invest In Land Than You Think

    You don't have to have a huge amount of capital to invest in land. You have many other options, including land-related ETFs and ETNs.
  2. Investing Basics

    Why Gasoline Costs What It Does

    The next time you have to dig deep into your wallet to fill your gas tank at least you'll know exactly what you're paying for.
  3. Trading Strategies

    Key Ratios For Analyzing Oil And Gas Stocks

    Oil and gas investors need to focus on a different subset of ratios to analyze the growth and profitability of these companies.
  4. Trading Strategies

    Guide To Oil And Gas Plays In North America

    Oil and gas shales in North America have been known for decades, but most investors don’t know it exists, or what is produced.
  5. Fundamental Analysis

    5 Biggest Risks Faced By Oil And Gas Companies

    Before investing in gas and oil stocks, consider such factors as political and geological risks.
  6. Fundamental Analysis

    A Natural Gas Primer

    Learn why natural gas is playing a larger role in the energy industry.
  7. Forex Education

    Natural Gas Industry: An Investment Guide

    Investors looking into this industry are faced with a confusing amount of information. We explain the important concepts and terms.
  8. Forex Education

    A Primer On Offshore Drilling

    Learn the important ratios and terms that you'll need to know to get involved in this trading sector.
  9. Investing

    The Most Expensive Oil Spills

    The only way to estimate the damage of the BP oil spill is to look at what past cleanups have cost.
  10. Budgeting

    Understanding Oil Industry Terminology

    The drillers are just one aspect of the oil & gas industry, and by knowing some details of their role, you'll be better suited to make investment decisions.
  1. How much oil must be produced to maintain inventory levels in the United States?

    Domestic energy investors should track the reserve inventory of crude oil for the United States, which is released in a weekly ... Read Full Answer >>
  2. What are average operating expenses for the oil and gas sector?

    The oil and gas sector plays an important role in the economy by drilling, extracting, and processing oil and gas. Because ... Read Full Answer >>
  3. To what extent is the oil and gas sector dominated by a few major companies?

    Oil and gas are two expansive and highly diverse product lines, with active competition domestically and internationally. ... Read Full Answer >>
  4. Why is investing in oil and gas in emerging markets riskier than investing in developed ...

    Investments in oil and gas in emerging markets generally carry higher risks than similar investments in developed countries. ... Read Full Answer >>
  5. How does the long-term outlook of the aerospace sector compare to the broader economy?

    As of 2015, the long-term outlook of the aerospace and defense sector is uncertain, much like the broader economy. That said, ... Read Full Answer >>
  6. How do the costs of oil sands producers compare to traditional drillers?

    The oil sands of Canada are some of the most expensive crude oil assets in the world to produce. Each asset type, such as ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Term Deposit

    A deposit held at a financial institution that has a fixed term, and guarantees return of principal.
  2. Zero-Sum Game

    A situation in which one person’s gain is equivalent to another’s loss, so that the net change in wealth or benefit is zero. ...
  3. Capitalization Rate

    The rate of return on a real estate investment property based on the income that the property is expected to generate.
  4. Gross Profit

    A company's total revenue (equivalent to total sales) minus the cost of goods sold. Gross profit is the profit a company ...
  5. Revenue

    The amount of money that a company actually receives during a specific period, including discounts and deductions for returned ...
  6. Normal Profit

    An economic condition occurring when the difference between a firm’s total revenue and total cost is equal to zero.
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!