This case history discusses the Palm Valley gas field in Central Australia. Production is obtained from a naturally fractured sandstone characterized by a very low matrix permeability (km <0.1 md).

An integrated study including detailed geology, core and log analyses, well testing and numerical simulation led to a good history match of a 33 hour interference test and over 7 years of production.

The conclusion was reached that 98% of the gas was stored in a very tight matrix and that the prolific production was only possible via a network of natural fractures.

The methodology used to reach a history match in this case history is presented in detail together with discussions of critical parameters such as fracture spacing, fracture porosity, and fracture permeability.

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