A method for drilling a new oil or gas well in a selected geographical location includes extracting drilling modes from historic drilling data obtained from a group of drilled wells in the selected geographical location using a pattern recognition model. Each drilling mode represents a distinct pattern that quantifies at least two drilling variables at a specified drilling depth. The method also includes selecting a sequence of drilling modes at positions along a reference well as reference drilling modes that represent more efficient values for a selection of one or more of the at least two drilling variables compared to other extracted drilling modes; associating drilling parameter settings with the reference drilling modes; and drilling the new oil or gas well applying at least some of the drilling parameter settings.