A water-base drilling fluid that contains dispersed oil or synthetic hydrocarbon as an internal phase. Early emulsion muds used diesel or crude oil dispersed into alkaline water-base muds. Synthetic liquids are now being substituted for oils in emulsion muds. Water-base muds containing certain synthetic liquids can be discharged in the Gulf of Mexico because they are environmentally safe and pass the EPA static sheen test and mysid shrimp toxicity tests.

Reference:
Rogers WF: "Oil-in-Water Emulsion Muds," in Composition and Properties of Oil Well Drilling Fluids, 3rd ed. Houston, Texas, USA: Gulf Publishing Company, 1963.