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Drilling economics

How to Calculate the Real Cost per Drilled Metre

Direct answer: Contractors are paid for useful holes, while fuel, compressed air, tooling, labour and downtime consume margin. Cost per accepted drilled metre is therefore more informative than purchase price or litres per hour, provided every input and operating condition is recorded consistently.

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How to Calculate the Real Cost per Drilled Metre
Article illustration from a published equipment listing. Open the linked inventory record or contact Leo for details about the pictured machine.

1. Define a transparent formula

Cost per accepted metre equals total attributable drilling cost divided by accepted drilled metres. Include rig and compressor energy, labour, tools, planned maintenance, repair accrual, ownership or rental, allocated mobilisation, downtime and rework. Accepted metres should meet the project's position, angle, depth and quality rules; gross metres can hide rejected or repeated work.

Define the reporting boundary before collecting data. Decide whether the period begins at shift start, arrival at the bench or the first hole, and whether moving, setup, refuelling and waiting are included. The same boundary must be applied to every machine and shift, otherwise the calculation rewards whichever record excludes more non-drilling time.

  • Agree the cost boundary before comparing machines
  • Use the same currency, period and tax basis
  • Record gross, rejected, re-drilled and accepted metres

2. See how the denominator changes the result

Consider an illustrative shift costing USD 2,730: USD 620 energy, USD 480 labour, USD 650 ownership, USD 420 tools, USD 260 maintenance and USD 300 downtime or mobilisation. If 80 gross metres include six metres that are not accepted, the result is USD 2,730 divided by 74, or USD 36.89 per accepted metre. Dividing by gross output would understate the cost. These numbers are examples only.

  • Replace every example with site records
  • Do not count rejected work as saleable production
  • State whether mobilisation and overhead are included

3. Match compressor pressure and airflow

For DTH drilling, the compressor is part of the production system. Epiroc's reference material explains that pressure influences penetration and that adequate free-air delivery is required to remove cuttings; poor flushing can cause re-crushing at the bit. Required air depends on hammer, hole, depth, groundwater, altitude, temperature, line losses and wear. Bigger is not automatically more economical.

Build the air requirement from the exact hammer manufacturer's chart at working pressure, then document allowances. Inspect hose diameter, length, couplings and leakage because nameplate free-air delivery is not the same as air available at the hammer. When conditions change, record the setting and outcome rather than assuming maximum pressure is always best.

  • Use the exact hammer air-consumption chart
  • Measure working pressure at the relevant point
  • Allow for altitude, depth, leakage and water

4. Measure fuel or energy per accepted metre

Log starting and ending fuel or energy, refuelling, rig and compressor hours, active drilling, idle time, pressure setting, hole specification and accepted production. Litres per hour can be misleading: a machine consuming less each hour may drill slowly and use more per metre. OEM field tests can suggest what to measure, but their results apply only to the tested models and conditions.

Use calibrated meters or a documented refuelling method and note fuel returned, transferred or consumed by auxiliary equipment. Separate the rig and compressor before combining their cost. Compare several shifts where possible, because one unusually easy hole, a warm engine or a partly filled tank can distort a short measurement.

  • Separate drilling, idle, setup and tramming
  • Calculate rig and compressor consumption
  • Compare like geology, hole size and tooling condition

5. Track tooling and hole-quality cost

Assign an identity to each bit, hammer and rod and record purchase or rebuild cost, metres, formation, failure mode and remaining condition. Tool cost per metre must include premature failure and rebuild where relevant. Also track collar error, deviation, depth error, blocked holes and secondary drilling: high penetration has little value if the finished holes are rejected.

Set the retirement rule before comparing tool life. A bit removed for gauge loss, button damage or planned rotation is not equivalent to a catastrophic failure. Record sharpening, rebuild and salvage value consistently. Where hole deviation cannot be measured during a short test, identify it as an unmeasured quality risk rather than assuming accuracy.

  • Follow each tool through its service life
  • Link wear to formation and operating settings
  • Include quality loss and rework

6. Price downtime and test a used system

Classify stoppages such as engine, compressor, hydraulic or rod-handler faults, tool failure, waiting for fuel or parts, moving and setup. For a purchase test, record machine identity, hours, fuel, hammer and bit, pressure, hole geometry, ground, start and completion times, interventions and final accepted result. Compare units only where the main test conditions are reasonably similar.

Attach a cost rule to each downtime category. A mechanical failure may consume labour, hired compressor time and missed production, while a planned move may be normal cycle time. Keep planned and unplanned events separate and include parts lead time in the stress scenario, especially where the machine will work far from service support.

  • Record duration and cause of every stop
  • Allocate labour, rental and support cost consistently
  • Use a representative, controlled drilling test

7. Scenario planning and evidence limits

Build an expected case, a stress case with slower penetration and parts delay, and an improvement case supported by measurable changes such as better air matching or less idle time. Include all work needed to make a used system productive. OEM specifications and field results do not establish fuel use, penetration, tool life or cost per metre for any unit on this website; only unit-specific configuration and site testing can do that.

  • Make assumptions visible and adjustable
  • Price deferred maintenance before comparing offers
  • Do not promise a production rate from a brochure or image

Topic decision table: How to Calculate the Real Cost per Drilled Metre

Decision checkpoints from this guide: How to Calculate the Real Cost per Drilled Metre
Topic checkpointBuyer actionEvidence-based explanation
1. Define a transparent formulaAgree the cost boundary before comparing machinesCost per accepted metre equals total attributable drilling cost divided by accepted drilled metres. Include rig and compressor energy, labour, tools, planned maintenance, repair accrual, ownership or rental, allocated mobilisation, downtime and rework. Accepted metres should meet the project's position, angle, depth and quality rules; gross metres can hide rejected or repeated work.
2. See how the denominator changes the resultReplace every example with site recordsConsider an illustrative shift costing USD 2,730: USD 620 energy, USD 480 labour, USD 650 ownership, USD 420 tools, USD 260 maintenance and USD 300 downtime or mobilisation. If 80 gross metres include six metres that are not accepted, the result is USD 2,730 divided by 74, or USD 36.89 per accepted metre. Dividing by gross output would understate the cost. These numbers are examples only.
3. Match compressor pressure and airflowUse the exact hammer air-consumption chartFor DTH drilling, the compressor is part of the production system. Epiroc's reference material explains that pressure influences penetration and that adequate free-air delivery is required to remove cuttings; poor flushing can cause re-crushing at the bit. Required air depends on hammer, hole, depth, groundwater, altitude, temperature, line losses and wear. Bigger is not automatically more economical.
4. Measure fuel or energy per accepted metreSeparate drilling, idle, setup and trammingLog starting and ending fuel or energy, refuelling, rig and compressor hours, active drilling, idle time, pressure setting, hole specification and accepted production. Litres per hour can be misleading: a machine consuming less each hour may drill slowly and use more per metre. OEM field tests can suggest what to measure, but their results apply only to the tested models and conditions.
5. Track tooling and hole-quality costFollow each tool through its service lifeAssign an identity to each bit, hammer and rod and record purchase or rebuild cost, metres, formation, failure mode and remaining condition. Tool cost per metre must include premature failure and rebuild where relevant. Also track collar error, deviation, depth error, blocked holes and secondary drilling: high penetration has little value if the finished holes are rejected.

Apply this guide to current inventory

Editorial details and evidence notes

How should the evidence be interpreted?

Evidence typeWhat it can supportWhat it cannot prove
Official or manufacturer sourceThe cited family, standard or regulatory statementThe configuration or condition of a listed used unit
Published inventory recordStock ID, supplied fields and linked listing photosCurrent availability, hidden condition or included scope
Unit inspection evidenceSerial-specific observations within the agreed test scopePerformance outside the tested conditions

Questions about using this guide

Does this guide prove that a listed machine has the feature or compliance discussed?

No. The guide explains a verification method. Confirm the exact stock ID, serial identity, installed configuration and destination rules before relying on it.

What should a buyer do before requesting a final quote?

Send the stock ID, project requirement, destination and requested inspection scope, then ask for current machine-specific evidence.

Need a unit-specific answer?

Send Leo the stock ID, destination and project requirements for a direct reply.

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