Cost estimating relationships (CERs) are very important tools in the planning phases of
an upstream project. CERs are, in general, multiple regression models developed to
estimate the cost of a particular item or scope of a project. They are based in historical
data that should pass through a normalization process before fitting a model. In the early
phases they are the primary tool for cost estimating. In later phases they are usually used
as an estimation validation tool and sometimes for benchmarking purposes. As in any
other modeling methodology there are number of important steps to build a model. In this
paper the process of building a CER to estimate drilling cost of onshore wells will be
addressed.
