Hydraulic fracturing stimulation technology is an effective method for increasing coalbed methane production, especially for coal seam with low permeability, low reservoir pressure and low gas saturation. Normally, fracture is simulated according to the law of equivalent percolation resistance, leading to the limit that fracture is several hundred times enlarged meanwhile the permeability is decreased, with wellbore located in the enlarged fracture, more fluids will produce through high conductive fracture path into wellbore. Based on theories and methods from oil-gas geology and mechanics of flow through porous media, this paper presents a two-phase, 3D flow and hydraulic fracturing model of dual-porosity media. A finite difference numerical model with independent fracture grid has been developed and applied successfully to a coalbed methane reservoir. Comparison results show that independent fracture grid is more effective than equivalent percolation resistance method in production fitting. Actual gas production data is consistent with results calculated by the new model, while prediction from equivalent percolation resistance is higher. (C) 2014 Elsevier Ltd. All rights reserved.