The present invention is a system and method for generating predictions for various parameters in a reservoir. The invention includes receiving input data characterizing the reservoir and determining transient areas. The transient areas are determined by receiving data from the reservoir, transforming the data using discrete wavelet transformation to produce transformed data, removing outliers from the transformed data, identifying and reducing noise from in the transformed data and then detecting transient areas in the transformed data. A computer model is produced in response to the transient data and predictions for parameters in the reservoir are determined. These predictions are verified by comparing predictive values with a reservoir model and then the predictions for the various parameters can be used.