Slick water fracturing has been increasingly applied to stimulate unconventional gas shale reservoirs. Comparing with cross-linked fluids, slick water used as a fracturing fluid has several advantages. Among them include low cost, higher possibility of creating complex fracture networks, less formation damage and easy-to-cleanup. Enormous amount of water is injected into the formation during the treatment. Even with a good recovery of injected water from flowback, large quantities of water are still left within the reservoir.

The dynamics of water phase within the created hydraulic fractures and reactivated natural fractures (induced fractures) have significant impact on both short and long term performance of a hydraulically fractured well. The dynamics of water phase within fractures are controlled by many mechanisms, such as relative permeability, capillary pressure, gravity segregation and stress-sensitive fracture conductivities. In this paper, reservoir simulation models for a generic gas shale reservoir are constructed to investigate the changes of water saturation distribution in fractures over time during the production and their impact on gas production performance. It is demonstrated that water imbibitions due to capillary pressure and gravity segregation can play important roles in water saturation distribution and redistribution, particularly during extended shut-in, which in turn affects gas flow significantly. Moreover, unfavorable combination of relative permeability, capillary pressure, stress-sensitive fracture conductivities and invasion zone permeability damage can lead to water blockage problems.

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