Abstract: This paper describes the methods and procedure to carry out 3 - D two - phasc numerical reservoir simulaion taking Ⅳ1－ 3 in the Northern Block of Shuanghe oilfield as an example, analyzes Ⅳ1－ 3 for matching and the controlling factors of residual oil distribution,and finally forecasts the ultimate recovery factor and production term of two development plans.