Petroleum production generates an immense amount of oily polluted water which may have harmful effects on environment At the same time, produced water is the biggest waste stream produced in the petroleum industry. In the past decades produced water treatment was the point of attention. However, the processes of treatment to separating water and oil have been enhanced gradually. This study used a two-dimensional computational fluid dynamics (CFD) model to investigate the effect of space between coalescing plates, orifice diameter and mixture inlet velocity on separation efficiency. Spacing values of 8, 12, 16, 20, 24 mm between plates, orifice diameters of 10, 15, 20 mm with different cross sections (e.g, cylindrical, rectangular, ellipse, and triangle) along with four different mixture inlet velocities of 0.02, 0.03, 0.04, 0.05 m/s were utilized to discover the effect of each parameter on the separation efficiency. The investigation revealed that the increase in the distance between plates was inversely proportional to the separation efficiency and the increase in the velocity of the mixture or mass flow rate inlet was inversely proportional to the separation efficiency. It was also found that the highest separation efficiency was obtained for the cylindrical shape with a hole diameter of 15 mm. It was also observed that the separation efficiency varied between 25% and 99.25% depending on the values of mixture inlet velocities and distance between plates.