Slimhole drilling provides an opportunity to significantly reduce overall drilling costs for exploration and development of oil fields. Cost reductions of 40-60% (or more) for exploration and appraisal wells and 25-40% (or more) for production and injection wells compared to conventional wells are possible. The savings are achieved by the use of smaller drilling and workover rigs, smaller locations, reduced casing sizes, reduced cutting volumes, less mud and cement, reduced fuel costs, and lower other costs associated with hole size. In addition, slimhole technology also provides an opportunity to minimize the effect of drilling operation on the environment and to improve working conditions. The effect of slimhole drilling on the environment includes minimized drilling wastes, reduced noise and air pollution, and less transportation for mobilization and demobilization of drilling equipment.