Ann: South Erregulla Update, page-117

Formation water is the water that is naturally present in the reservoir. It exists in the pore spaces of the reservoir rock and can be produced alongside oil and gas.
The Gas-Water Contact (GWC), on the other hand, is a term used to describe the boundary in a reservoir above which predominantly gas occurs and below which predominantly water occurs. It represents the lowest elevation at which mobile hydrocarbons occur.
So, while formation water refers to the water present in the reservoir, the GWC is the boundary that separates the gas and water zones in the reservoir. Both are important concepts in reservoir engineering and can influence the production strategy and ultimate recovery of hydrocarbons from a reservoir.