The three-phase flow in the oil industry is characterized by the presence of the gas, oil and water phases. The presence of the third phase (water) adds complexity to this process, since it can cause the formation of several new flow patterns in addition to those already known for two-phase flow. Additionally, the presence of a dispersed phase into another can form an emulsion, altering significantly the viscosity and consequently influencing directly the pressure drop. The focus of this job is in the prediction of the slug flow with dispersions of water and oil using a one-dimensional transient Two Fluid model. The presence of water in the flow is modelled with the solution of an equation of conservation of mass. Intending to predict with precision the pressure drop, as the volumetric phase distribution of each phase throw the domain, an algebraic closure model was inserted to assess the slip between the liquid phases. With the proposed model, the results obtained for the slip velocity of the water/oil flow were compared with experimental data and other models, showing excellent performance. The model was then used to analyze the three-phase flow in the slug pattern. The predictions for pressure drop and characteristics of the slugs (length, frequency and translation velocity) have been compared with experimental data from the literature and the results are promising.