fax 01-972-952-9435. AbstractThe paper describes reservoir management challenges during the first 5 years of the production from the Terra Nova oil field, located offshore Newfoundland and Labrador, Canada.

The Peregrino heavy oil field is located 85 km off the coast of Cabo Frio, Rio de Janeiro. The water depth in the area is approximately 120 m. Phase I of the development comprises a FPSO and two wellhead/ drilling platforms. Production of oil started in April 2011. Statoil is operator with 60% equity and partner Sinochem holds 40%. To date, more than 80 million barrels of 14°API oil has been lifted and close to 30 development wells have been drilled. The drive mechanism of the reservoir is reinjection of produced water and pressure support from the aquifer.The new Phase II development involves a third wellhead platform tied back to the FPSO. It targets oil resources that cannot be reached from the two existing wellhead platforms. An extensive exploratory drilling program with a total of six reservoir penetrations and a detailed data collection program were undertaken in 2011-2012. From the drilling campaign the Peregrino field was found to have a large southern extension with additional 1-2 billion barrels of oil in place that could be developed. In spite of many similarities with the geology in Phase I, the new reservoirs held a number of surprises with respect to reservoir fluid (lighter oil was found) and different reservoir properties.This paper describes the experiences and challenges with developing this offshore heavy oil field from a subsurface point of view: These include appraisal strategy for optimum data collection, reservoir modelling, and impact on design parameters such as production capacities. Many of these challenges are generic for heavy oil fields: how to handle large amounts of water circulation, identifying reservoir data that are critical for field planning such as absolute and relative permeability. Heavy oil reservoirs with oil viscosity of several hundred centipois are usually high quality reservoirs with relatively homogenous sandstone, as is the case with the Peregrino field for the most part. This paper discusses critical factors in determining reservoir performance for a wide range of reservoir parameters, and includes a section on how this was implemented in the uncertainty analysis.Safe water injection into the oil zone to avoid fracturing the cap rock is very important. This has been assured both through theoretical work and data from an injection well in the Peregrino field. All producers in Peregrino are horizontal wells (with open-hole gravel packs) in order to improve productivity and drainage. Flow assurance and oil-water transport in wells and flow lines are also described. Use of inflow control valves in horizontal wells have shown potential in Peregrino and will be described in the paper.