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Nov 05, 2023

The drill bit evolves from 'dumb iron' to 'smart bit'

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Howard Hughes Sr. revolutionized the drill bit more than 100 years ago to accelerate the oil boom that made Houston and Texas the nation's energy capital. Today, his legacy company is aiming to make the next evolutionary step with new drill bits that automatically adjust to the underground rock terrain.

The pressure-sensitive technology is part of a growing effort from Baker Hughes and other power players like Schlumberger and Halliburton to build more durable and faster-drilling bits that adapt to any type of shale rock.

Houston-based Baker Hughes on Tuesday launched its TerrAdapt self-adjusting drill bit, which, for the first time, automatically extends diamond-material buttons to provide additional protection to the bit's diamond cutters when the going gets too rough and retracts them when the rock softens up.

Oil field services companies used to just modify more expensive offshore technologies to work onshore, but now they're increasingly developing products specifically for shale rock drilling as the U.S. onshore market increasingly dominates the industry, said Byron Pope, an analyst with Tudor, Pickering, Holt & Co. in Houston.

After all, horizontally drilled extensions from onshore wells now extend more than 10,000 feet on average.

The TerrAdapt that adjusts on the fly is a potential game changer, Pope said. "The difference with the technology is you don't necessarily have to customize it for the Permian or Eagle Ford," he said. "You can just have that one bit."

Baker Hughes is touting the product as turning "dumb iron" into the first "smart bit." The bit creates more stability while reducing vibrations within a well, leading to straighter wells drilled at faster speeds, said Scott Schmidt, Baker Hughes' vice president of drill bits.

The product can work in nearly any location, but is specifically designed for West Texas' booming Permian Basin, where there's lots of oil and gas within several different rock formations stacked on top of each other.

Some wells cut through limestone, sandstone, dolomite and shale rock, Schmidt said, and the abrupt changes can cause hard stops and starts, sometimes requiring the drilling process to start over, adding additional time and costs.

The new bit helps with smooth transitions to different types of rock, so it can more easily move through what would otherwise be abrupt changes.

Schmidt likens it to how a car seatbelt seizes with sudden force. "If you yank on it, it resists. But if you gradually pull it, it will move," he said.

Howard Hughes introduced the two-cone rotary rock drill bit in 1909, and the moving-parts bit dominated the market for years until his company's tri-cone model become the industry standard for decades.

In the shale era, however, the fixed, diamond-cutter bits have taken over the market share. The more durable diamond bits don't have moving parts, but they can drill faster for longer in most shale rock. Now, smaller moving parts are being incorporated into the fixed bit.

Baker Hughes has not priced its new bit yet. Drill bits can easily cost $30,000 each and skew much higher for premium products such as TerrAdapt.

Earlier this year, Houston-based Halliburton marketed its bits with new Cruzer technology.

The small Cruzer rolling wheels at the tip of the bit help maintain drilling control while reducing wear and tear, said Brad Dunbar, Halliburton's drill bits product manager.

For sheer power, Schlumberger recently released its AxeBlade ridged diamond bits designed for more aggressive drilling and rock crushing.

The eventual goal is marrying these smarter and stronger drill bits with drilling rig technologies that digitally sense changing rock structures before the bit reaches the rock.

That would create a more seamless and automated drilling process, Dunbar said. "Otherwise, everything is reactionary."

But they're not quite there yet, he said.

Once they're there, companies can drill vertically and curve into horizontal drilling much more easily without skipping a beat.

In the meantime, change comes gradually.

"We're a little bit cautious about making things overly complicated," Dunbar said, and inadvertently less efficient.