The Shasan formation in Block Wa38, Liaohe oilfield is a typical, massive, permeable-sandstone, heavy-oil reservoir. Dead-oil viscosity at reservoir temperature is about 12615cp and the gross formation thickness is roughly 110 m. Cyclic steam injection using vertical wells has been applied successfully for about 10 years, but is reaching the economic limit. This work quantifies the distribution of heat throughout the block and locates the remaining oil saturation using analytical and numerical models. Methods for additional recovery as well as replacement technologies are explored using reservoir simulation. The first and most significant step of this work is the interpretation of the effect of multiple cycles of steam stimulation on the remaining oil saturation. Field data, semi-analytical methods, and numerical simulation are combined to obtain realizations of the distribution of heat and oil saturation throughout a block containing 18 wells. Results show that the remaining oil is mainly distributed in the lower portion of the reservoir layer and that the reservoir volume surrounding wells is desaturated. Thus, steam override influences the sweep efficiency. The reservoir is a candidate for continuous steam injection given the distribution of remaining oil and heat within the reservoir. Numerical reservoir simulation is used to optimize the parameters in the steam-flooding process using existing vertical wells and potential horizontal well candidates. High and low quality continuous steam injection is considered. Results show that further development using steam is effective at recovering oil with decreased operational cost. At the same time, the results also show that the heat communication between the wells from cyclic steaming operations aids greatly steam flood startup.