There is incomplete understanding of the influence of shear failure observed in field operations in sand formations. This work explains the effect of shear failure on permeability anisotropy and dilation in sands. Three-dimensional discrete element modeling is used to model the behavior of uncemented and weakly cemented sand samples. Mechanical deformation data from experiments conducted on sand samples is used to calibrate the properties of the spherical particles in the simulations. A rolling resistance strategy is applied in the simulations, incorporating the stiffness of the specimens due to particle angularity, aiding in the calibration of the simulated samples against experimental data to derive optimum granular scale elastic and friction properties. A flexible membrane algorithm is applied on the lateral boundary of the simulation samples to implement the effect of a rubber/latex jacket. Simulations are extended to non-cylindrical specimen geometries to simulate field-like anisotropic stress regimes. Pore network fluid flow simulations are conducted before and after mechanical deformation to observe the effect of failure and stress anisotropy on the permeability anisotropy and dilation of the granular specimen. The effect of confining pressure, stress anisotropy, and particle size distribution on failure, permeability and dilation is studied

The effect of shear failure on the permeability is confirmed and calculated. The shear failure plane alignment is observed to be parallel to the maximum horizontal stress plane. Flow simulations confirm the increase in permeability due to shear failure and show a significantly greater permeability increase in the maximum horizontal stress direction. Permeability anisotropy is observed and permeability tensors are calculated.