For oil reservoir with bottom water and/or gas cap, gas and water conings impose serious problems during the oil production. Coning leads to the premature gas and water breakthrough thus results in high water cut and gas oil ratio, which require a higher surface facility capacity to process excessively produced water and larger three-phase separators to separate gas, oil, and water. Consequences of early breakthrough are large footprint due to large facility, more energy to operate field, and low oil recovery. Even though numerous studies had been focused on solving the critical oil rate for gas and water coning problems, to our knowledge none of them considers the effect of capillary pressure on critical oil rate. The ignorance of capillary pressure caused the error of calculated critical rate to rise to 300%, according to the real field case study.

The errors caused by neglecting capillary pressure are severe in low permeability reservoirs. For the purpose of good production design, we investigated the effect of capillary pressure on critical rate estimation. Our study showed that the calculated critical rates are close to real field critical rates. The existing methods underestimate the critical rate by not taking capillary pressure into account. Therefore, more accurate critical rates can be obtained using our method. With more accurate result more reliable production plan can be designed to maximize the ultimate recovery.

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