This work investigated the effects of breakage and coalescence on de-oiling hydrocyclone performance utilizing Computational Fluid Dynamics (CFD). It was found that an increase in the entrance flow rate with low entrance oil concentration not only did not increase the separation performance of the hydrocyclone but it also decreased the separation efficiency. On the contrary, the hydrocyclone performance was enhanced with increasing the inlet velocity. Furthermore, a comparison between the standard design and the conical inlet chamber design was drawn in terms of separation efficiency for low entrance oil concentration; the results depicted that the conical design had higher separation efficiency.