The Answer:

To spud comes from the Middle English word, "spudde" meaning a short knife. In oil drilling "spudding" means the very start of drilling on a new well. The American Petroleum Institute offers the following definitions using the word spud:

Spud Contractor Name

The name of the contractor spudding the well.

Spud Date

The day when the drilling bit penetrates the surface utilizing a drilling rig capable of drilling the well to the authorized total depth.

Spud Time

The actual time (hours and minutes) when the drilling bit penetrates the surface utilizing a drilling rig capable of drilling the well to the authorized depth.

Spudding In

The very beginning of drilling operations of a new well.

—The Fact Monster