Abstract: A method is disclosed that provides a stable invert emulsion for an oil-based drilling fluid with an environmentally friendly additive that effectively eliminates shale hydration and consequent borehole erosion. The additive is preferably potassium formate, although other formates or acetates may be substituted. In the method, the potassium formate is dissolved in the water phase of the emulsion in lieu of other less environmentally friendly salts such as sodium chloride. The water activity of the emulsion and of the formation being drilled is monitored during drilling so that additional formate may be added as needed to maintain such water activities in balance. That is, preferably, the water activity of the potassium formate will be the same as or less than the water activity of the formation.