This report describes work performed during the third and final year of the project, 'Tmproved Techniques for Fluid Diversion in Oil Recovery." This project was directed at reducing water production and increasing oil recovery efficiency. In the United States, more than 20 billion barrels of water are produced each year during oilfield operations. An average of 7 barrels of water are produced for each barrel of oil. Today, the cost of water disposal is typically between $0.25 and $0.50 per bbl. Therefore, there is a tremendous economic incentive to reduce water production if that can be accomplished without sacrificing hydrocarbon production. Environmental considerations also provide a significant incentive to reduce water production during oilfield operations.This three-year project had two technical objectives. The first objective was to compare the effectiveness of gels in fluid diversion (water shutoff) with those of other types of processes. Several different types of fluid-diversion processes were compared, including those using gels , foams , emulsions, particulates, and microorganisms. The ultimate goals of these comparisons were to (1) establish which of these processes are most effective in a given application and (2) determine whether aspects of one process can be combined with those of other processes to improve performance. Analyses and experiments were performed to verify which materials are the most effective in entering and blocking high-permeability zones.The second objective of the project was to identify the mechanisms by which materials (particularly gels) selectively reduce permeability to water more than to oil. A capacity to reduce water permeability much more than oil or gas permeability is critical to the success of gel treatments in production wells if zones cannot be isolated during gel placement.Topics covered in this report include (1) determination of gel properties in fractures, (2) investigation of schemes to optimize gel placement in fractured systems, (3) an investigation of why some polymers and gels can reduce water permeability more than oil permeability, (4) consideration of whether microorganisms and particulates can exhibit placement properties that are superior to those of gels, and (5) examination of when foams may show placement properties that are superior to those of gels.This project received financial support from the U.S. Department of Energy, the State of New Mexico, and a consortium of 10 oil companies. The technology developed in this project was transferred to the oil industry in several ways. First, project review meetings were held regularly, with 27 people from 13 organizations attending the most recent review (August 15-16, 1995). Second, technical progress reports were issued quarterly and annually. Third, papers were regularly presented at meetings of the Society of Petroleum Engineers (SPE) and were published in SPE and other journals (see Appendix F). Fourth, in conjunction with SPE's Distinguished Lecture Series, the presentation, " Cost-Effect...