Changing the value of the porosity or the horizontal or vertical permeability in any grid cell in a reservoir simulator by a small amount often results in a small change in the value of a property predicted by the simulator. The ratio of change in prediction to change in reservoir property is called the sensitivity coefficient. In this paper, we describe the use of the adjoint system of equations to compute the sensitivity of wellbore pressure, water-oil ratio, and gas-oil ratio to changes in gridblock permeability and porosity. Unlike some other methods of computing sensitivity coefficients, this method is applicable for problems with large numbers of model parameters and for problems in which cross-flow and compressibility are significant. Although the adjoint system has previously been used to compute the gradient of an objective function for three-phase flow data with respect to model parameters, the sensitivity coefficients are significantly more powerful as they enable the use of Newton-like methods with quadratic convergence, i.e., estimation of the covariance of model estimates based on the inverse of the Hessian, and they provide insight into the information content of data. We use several three-phase flow examples with solution-gas drive, gas injection, and gravity segregation to illustrate these ideas.