Proper characterization of reservoir heterogeneities is a well recognized requirement to accurately predict reservoir performance. Given the large investment requirements, long development schedules, and the often uncertain economic outlook, sound decision making requires reasonable estimates of how much, and when, oil will be produced. It is no longer sufficient to estimate total oil in place and apply an ad-hoc recovery factor to determine reserves. Average values for properties such as porosity, fluid saturations, and thickness can be used to establish the total amount of fluids in place. However, averages are less reliable once volumetrics have been estimated; predicting fluid movement within a reservoir is more difficult because flow is greatly influenced by extreme high and low values not well characterized by average quantities. As a result, the general trend in the oil industry has been to underpredict the variability and overpredict the continuity of reservoir properties, which usually results in optimistic predictions of reservoir performance.