The Hutton reservoir in the Merrimelia Field (Cooper-Eromanga Basin) was the subject of a 3-D reservoir simulation study. The primary objective of the study was to develop a reservoir management tool for evaluating the performance of the field under various depletion options. The study confirmed that the ultimate oil recovery from this strong water drive reservoir was not adversely affected by increasing total fluid offtake rate. However, any decisions regarding changes to the depletion scheme such as increasing production rates, if based solely on computer simulation results, should be viewed with caution. Careful monitoring of any changes to the depletion philosophy and checking of actual data against simulation predictions are essential to ensure that oil production rate and ultimate recovery are optimised. The model assisted in evaluating the economics of development drilling. While the simulation results are dependent on the validity of geological mapping, the model was useful in confirming that, due to very high transmissibility in the Hutton reservoir, additional wells would only accelerate production rather than increase ultimate recovery. The issue of drilling wells thus became one of balancing the benefits of accelerating production against the geological risk associated with that well. Interaction between the reservoir engineer and various disciplines, particularly development geology, is critical in the development and application of a good working simulation model. This was found to be especially important during the history matching phase in the study. If engineers and development geologists can learn more of the others' discipline and appreciate the role that each has to play in simulation studies, the validity of such models can only be improved. The paper addresses a number of the pitfalls commonly encountered in application of reservoir simulation results.