Patent ID: 8095349

Claim:
A method of managing a production of hydrocarbons from a subsurface formation via a well drilled into the subsurface formation, comprising the steps of: a. forming a model of a subsurface of the earth including at least a portion of said subsurface formation, thereby forming a subsurface model; b. discritizing said subsurface model, thereby obtaining a plurality of grid blocks representative of said subsurface model; c. assigning at least one physical parameter value to each grid block of said plurality of grid blocks, wherein said at least one physical parameter assigned to each grid block comprises a permeability and an X-direction transmissibility, a Y-direction transmissibility, and a Z-direction transmissibility; d. allocating at least a portion of the hydrocarbons in the subsurface formation to two or more of said plurality of said grid blocks, thereby creating a plurality of hydrocarbon blocks; e. determining which of said plurality of hydrocarbon blocks is not in fluid communication with the well, thereby determining at least one non-communicating block; f. flagging as nonproductive each of said at least one non-communicating block; g. using at least said assigned permeability of each of said plurality of grid blocks, said plurality of hydrocarbon blocks, and said at least one flagged noncommunicating block to upscale said subsurface model, thereby producing an upscaled subsurface model comprised of at least two upscaled subsurface grid blocks, and, using at least said assigned X-direction transmissibility, said Y-direction transmissibility, and said Z-direction transmissibility of each of said plurality of grid blocks to produce an upscaled transmissibility model commensurate in size with upscaled subsurface model; h. performing a dynamic reservoir computer simulation using at least said upscaled subsurface model and said upscaled transmissibility model, thereby obtaining simulation results; and, i. using at least a portion of said simulation results to manage production of hydrocarbons via the well.