To reach a particular reservoir objective, the hole needs to be drilled in stages. Because of this, a telescopic effect will take place. Each stage will have a reduced diameter. Stages or casings placements are done strategically, considering shallow gas hazards, low pressure zones, poor consolidated sands and other factors. A typical 3km well will take 2-3 casing sizes. A surface hole will be drilled (normally 17-1/2" or 12-1/4") to a point where the formation is strong enough for pressure containment (in drilling terms, deep enough to close the BOP and shut in the well). Then, a casing (steel tubular) will be ran in joints of 12.5m all the way down to section TD (total depth) and cemented in place. For example, say we drill a 12-1/4" surface hole, we will then set a 9-5/8" casing string. Then, we will drill a 8-1/2" production hole to TD and run a 7" casing or liner. A liner is just a shorter casing section and its hanging point is in the previous casing size using what's called a liner hanger.
Cementing is the most important element of securing a hole and it's normally the easiest to screw up. Once a string of casing is ran, cement will be blown by air pressure @ 110 psi from silos on the rig to the cementing unit. The cementing unit will then mix and pump a slurry based on a pre-determined receipe. The slurry will then be pumped into the string and up the annulus. The bottom of the casing will have what's called a shoe track (just a one-way check valve to ensure that cement does not flow back into the casing string).
The recipe will include things like retarder (to make it thicken at a slower rate), fluid loss, dispersants, silica and other additives. The cement act as the bond between casing and formation. It also seals the annulus (the area between casing and formation) from gas or fluids migration. For production casing, the cement gives a certain compressive strength to enable a clean perforation for access to hydrocarbon. More details on perforation next tiem.