Abstract: In horizontal drilling operations in Sulige gas field, mud losses and borehole wall collapse have occurred in the same slant open hole section. This problem is especially frequently encountered in the block Su-54, where the Liujiagou formation has low pressure bearing capacity and mud losses have occurred frequently. The Shuangshiceng formation, on the other hand, has high collapse pressure and is therefore prone to borehole collapse. Mud losses in the Liujiagou formation and borehole wall collapse in the Shuangshiceng formation are characteristic of the formations in Sulige gas field. To deal with these problems, a compound salts drilling fluid with "low clay content, strong plugging capacity and low density" was developed through laboratory experiments. This drilling fluid, with a certain content of useful solids, was treated with 2% emulsified asphalt, 3% ultra-fine CaCO₃ and 1% polyglycol. When the hole angle was increased to 30°, the drilling fluid was further treated with pre-hydrated bentonite slurry to have bentonite content of not higher than 50 g/L. This helped improve the quality of mud cakes, thereby enhancing the capacity of the mud to protect the borehole wall from collapsing. The addition of bentonite slurry also increased the yield point of the mud, rendering the mud better hole cleaning capacity, and this in turn helped decrease mud weight and flow rate necessary for safe drilling operations. Field operations proved that this mud formulation has properties that are compatible with the formation characteristics of the Sulige gas field, and has good inhibitive capacity and strong mud loss control capacity. Remarkable application effects of the drilling fluid formulation have been gained in Sulige gas field.