To overcome the effect of floating platform heave motion on the drilling operation, a new crown-block heave compensation system with compound cylinders is developed. The new heave compensation system has certain advantages, such as low derrick, short hydraulic pipeline, compact structure, easy operation, etc. The numerical calculation functions of the new heave compensation system are established based on the theories of fluid dynamics and theoretical mechanics. The entire model was built using the Simulink module of MATLAB with a hierarchical structure. As the core component of the compensation system, four control strategies are established to improve the compensation performance, including the PID control, fuzzy control, fuzzy PID control, and Terminal Sliding Mode (TSM) control. Laboratory equipment with a ratio of 1:5 to the new compensation system was designed and developed. The simulation and experimental results show that the new compensation system achieves a good compensation rate of more than 90% under different heave conditions. Among these four strategies, the TSM control strategy generates the highest compensation rate and lowest power fluctuation for the compensation cylinders.INDEX TERMS Compound cylinder, control strategy, crown-block, drill string heave compensation, offshore drilling platform, terminal sliding mode (TSM), experimental validation.