Horizontal Pipe Separators (HPS©) are used for separation of oil and water especially in subsea environment owing to its simplicity, installation, and operation. In the present work, the flow phenomena in the HPS with 0.0762m ID and 10.3 m long separating oil and water with specific gravities of 1 and 0.857 is simulated and analyzed using ANSYS Fluent 16. Hexahedral mesh with boundary layers has been done utilizing ANSYS design modeler for this analysis. A grid independence study is performed on 3 different mesh grids using grid convergence index. 3-D simulations are carried out using a Hybrid Eulerian-Eulerian Multifluid VOF model for watercuts ranging from 20 to 80% and a mixture velocity of 0.08 m/s. The CFD simulations analyzed the effect of watercut on the oil-water mixture flow behavior and the entry region required for the oil and water to separate in the HPS. These simulation results are validated against acquired experimental data by Othman in 2010. These simulations provide an insight to understand the effects of diameter, watercut, and mixture velocities on the performance of HPS to aid in its design and scale up/down studies.