TX 75083-3836, U.S.A., fax 01-972-952-9435. AbstractFollowing encouraging results of Under-Balanced Drilling ("UBD") applications in the North Sea and onshore Canada, Shell Malaysia Exploration and Production ("SM-EP") embarked upon the application of this technology in a shallow clastic oil field in offshore Sabah. Relatively little information is available in the public domain regarding the effectiveness of UBD in clastic oil reservoirs. This paper provides factual evidence relevant to the assessment of UBD-induced added value. The paper also provides a comparison between the cost and benefit of UBD with that of Under-Balanced Perforating ("UBP") in a two-well trial.Every pressure regime, reservoir fluid type, geological circumstance, etc, requires a specific operational configuration custom made for the situation at hand. This is a major source of UBD-induced incremental cost. Different reservoirs require different UBD configurations so analogies that assist the business case of a UBD project are currently limited and are difficult to find. This was the first offshore application of crude oil and hydrocarbon gas injection as drilling fluid in jointed pipe operations. A description of the incentives and risks of our specific geological circumstances is provided. Detail will be provided regarding our UBD design, main operational-risk mitigation measures, and the strategy used to appraise the added value of UBD. The complexities, incentives, and pitfalls of our UBD strategy will be chronicled. The initial results of this first-ever UBD trial within SM_EP will be published, along with the lessons that we have learned.