Abstract: In accordance with an embodiment of the present invention, a drilling tool includes a tubular body defining a longitudinal axial cavity extending therethrough and defining at least one cutter element recess. The drilling tool also includes a cutter element at least partially disposed within the at least one cutter element recess and includes at least first and second cutting arms at least substantially disposed within the cutter element recess in a retracted position. The first and second cutting arms are operable to move from the retracted position to an extended position in which the first and second cutting arms extend at least partially beyond a periphery of the tubular body. The first and second cutting arms and the tubular body enclose a space when the first and second cutting arms are in the extended position.