The Permian Clear Fork reservoirs of the Permian Basin in West Texas and New Mexico are estimated to contain 6.5 billion barrels of remaining oil. The recovery efficiency of these complex sets of carbonate reservoirs is generally very low (around 8-15%) due to the presence of a wide variety of interwell heterogeneities, impact of fractures with different types of porefillings, etc. In this project, the Bureau of Economic Geology at the University of Texas at Austin, through a consortium of 14 major and independent oil companies, is using outcrop and subsurface geologic and petrophysical data for a robust modeling of the 3D reservoir environment. To develop a reservoir model for a 1 square mile area of the middle and lower Clear Fork reservoirs, a detailed stratigraphic framework and high frequency cycle (HFC) architecture is first developed from subsurface core data in South Wasson field, guided by detailed outcrop studies at Apache Canyon of the equivalent formation and 3D seismic data. Each HFC is composed of an upper more porous grain-dominated fabric and a lower less porous mud-dominated fabric. The carbonate rocks were then divided into three rock-fabric classes based on thin section descriptions and wireline logs. A unique relationship between rock-fabric and pore-size distribution allowed a single porosity-permeability transform for each class. After identification of the rock-fabrics and cycles from core descriptions, these were mapped throughout the reservoir using wireline logs. The permeabilities computed from rock-fabric data had excellent agreement with those obtained from core data. The rock-fabric flow layers and permeability profiles defined the reservoir model. Twenty-two high frequency cycles were correlated between 38 wells in the 1-square-mile study area. Porosity, permeability and water saturation values were calculated at each well and the values interpolated between wells. The layered nature of the reservoir and considerable lateral heterogeneity can be seen in the cross-section of permeability distributions shown above. An 1,800 ft transact of 1 inch diameter samples were collected from one cycle at the Apache Canyon outcrop and the transact sampled with 5 ft spacing. Permeability, porosity, and grain density were measured and the spatial statistics analyzed geostatistically. A detailed stochastic model of an ideal HFC constructed with the above data shows considerable lateral variability. From outcrop measurements, a power law relationship was defined between fracture aperture and length and the information integrated in the Clear Fork reservoir model. However, most of the fractures in the subsurface were filled with dolomite and anhydrite, and the timing of their generation relative to fracture formation is a key to predicting fracture permeability. The technology for identification and mapping of high and low permeable flow layers, their petrophysical properties and other small-scale heterogeneities developed in this project will considerably help in enhancing production from these complex set of reservoirs. Even if a tenth of the remaining oil in Clear Fork reservoirs could be recovered by the application of the new technology developed in this project, then it would add 650 MMBLS to the national oil reserves. Addition of such a reserve will generate $1,462 and $448 million in royalty and taxes respectively and will add ~1623 new jobs across all sectors of the Texas economy.