Oil wells with an oscillating production rate have a lower production compared to oil wells producing at a constant rate. This study looks at instability caused by the casing-heading phenomenon. Control is applied to achieve stable production rate. Two realistic gas lifted systems for oil and gas production are investigated, using the multiphase flow simulator OLGA2000. Different control structures are evaluated, and linear stability analysis is used to substantiate open loop simulation results. The study shows that substantial production improvement can be achieved by applying control to the above mentioned system.