A new diffusivity equation for two-phase (water/steam) flow in geothermal reservoirs is derived. The geothermal reservoir may be initially two-phase or may evolve into a two-phase system during production. Solutions of the diffusivity equation for a continuous line source are presented; the solutions imply that the plot of bottomhole pressure vs. log10t (t = time) should be a straight line. The slope of the straight line is inversely proportional to the total kinematic mobility. Comparison of the theory with a limited number of computer-simulated drawdown histories shows excellent agreement.

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