The present invention involves a method of developing a model of groundwater flow with a well configuration. First, a geographic area is specified with one or more related wells. A mathematical model is created of the groundwater flow in relation to the wells with a plurality of layers, each layer having a local flow component and a leakage component. The plurality of layers is modified based on the leakage component of adjacent layers. The simulation of groundwater flow to a collector well, horizontal well, or gallery may thus be accomplished by specifying an array of line-sink elements that represent the lateral arms of the collector well, horizontal well, or gallery. Boundary conditions for groundwater flow to the lateral arms may then be specified. Groundwater flows are then calculated based on the array and boundary conditions, with updating of the boundary conditions during the calculation. Each of the layers may include a component related to frictional head loss. The head losses due to flow into and within the lateral arms may be used to update the layers. Modifications of the models may involve calculating discharge potentials or a head specified condition.