Two alternative mathematical models are presented that are suitable for numerical simulation of geothermal reservoirs. The general mathematical model describes the three‐dimensional flow of single‐component water (both one and two phase) and the transport of heat in porous media. It is composed of two nonlinear partial differential equations, posed in terms of fluid pressure and enthalpy, and appropriate boundary conditions. An alternative quasi‐three‐dimensional model is derived by partial integration (in the vertical dimension) of the three‐dimensional equations. The reservoir is assumed to have good vertical communication so that vertical equilibrium (gravity segregation) between steam and water is achieved. The resulting equations, posed in terms of vertically averaged pressure and enthalpy, include effects of an inclined, variable‐thickness reservoir and mass and energy leakage to con