Hydraulic cavity has been demonstrated to be an efficient gas extraction technology in the single, soft, and low-permeability coal seam in China. However, the permeability evolution around hydraulic cavity has not been fully understood due to the lack of the permeability model in the post-peak stage, which leads to a great challenge for the gas extraction simulation and thus the borehole design. Therefore, we developed a fully coupled dual-porosity gas extraction model that considers the effects of coal damage on the permeability evolution. Based on this model, we analyzed the permeability evolution and the gas migration characteristics around the hydraulic cavity and designed a hydraulic cavity scheme for the Shijiazhuang coalmine. The field application results prove that our simulation results are correct.