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Compaction-induced permeability reduction in a producing reservoir rock/soil can be significant, but nevertheless is often neglected or overly simplified in reservoir simulations. Provided examples show that the commonly used compaction models in reservoir simulators are not capable of capturing the actual spatial variation of the compaction, which generally is more complex than the simplified models predict. The only way to compute a reliable compaction state is by rock mechanics simulation. The computing time can be considerably reduced by an accurate and efficient procedure, which has been used to do the compaction modeling and study the effects of permeability reduction on fluid flow and production. Weak, moderate, and strong materials behave differently when loaded, such that large contrasts in initial permeability can be reduced by increasing load (depletion), resulting in more homogeneous flow. It is demonstrated how this can be utilized to achieve better sweep efficiency, reduced water production and increased oil recovery. The effects are especially pronounced when the pressure reduction is considerable (“pressure blowdown”). The data used are from Brent-type reservoirs, but the results also apply to a wider range of reservoirs.