Described is a system for estimating measured depth of a borehole. The system comprises a drilling fluid pulse telemetry system positioned in a borehole and processors connected with the drilling fluid pulse telemetry system. Time series measures are obtained from an environmental sensor package. Initial estimates of a time delay and path attenuation amplitude are determined. An error for the initial estimates is determined, and iterative minimization of the error is performed until source signal parameters converge, resulting in a least squares estimate of the source signal and the reflected signals. The least squares estimate is used to obtain time delay values, which are then used to continuously generate an estimate of a measured depth of the borehole.