Practical application of fault seal analysis for reducing risk in hydrocarbon exploration and CO2 storage, and for predicting the dynamics of reservoirs under stress, requires that both small and large scale processes within and around fault zones are understood and that structural evolution is related directly to changes in permeability through calibrations with available field and laboratory data. In 2006 the research organizations CSIRO (Australia) and TNO (Netherlands) came together with industry sponsors to form a research consortium to investigate the dynamics of permeability evolution in clay-smear type fault zones in sandstone/mudrock sequences. The plan was rather ambitious, requiring new developments in laboratory apparatus and in numerical modeling approaches to this problem. The objectives were: 1. To create in the laboratory some of the largest scale shear zones attempted so far under reservoir stress conditions, reaching 100 mm of displacement, and with sufficient freedom of kinematics to allow 3-dimensional fault structures to develop. 2. To conduct the tests at a range of effective stresses reaching up to around 30 MPa faultnormal stress, equivalent to several kilometers of burial. 3. To implement direct fluid flow and pressure monitoring during the dynamic shearing and static loading of the model fault zone during its evolution; this required the development of an entirely new self-sealing system for the fluid cell. 4. To dissect and image the fault zones produced in order to understand the structural evolution on the fine scale in three dimensions. 5. To use a combination of finite element (FE) and discrete element modeling (DEM) to recreate the experimental conditions of the laboratory experiments’ kinematics and geomechanical responses and to extrapolate from the measured parameter sets into wider and more continuous variations in rock properties and stress conditions.