In BCRs, gas holdup is an essential parameter as its knowledge helps to determine the gas-liquid interfacial area, which is necessary for prediction of gas-liquid mass transfer coefficient, KLa. In the current research work, a CFD model is developed to estimate gas holdup for co-current air-water system in a BCR operating in bubbly flow regime. Unsteady 2d-axisymmetric, Eulerian-Eulerian multiphase model with segregated solver is considered while turbulence effects are introduced by using k-ε model. The BCR considered in this study has 19 cm inner diameter and 274 cm length, whose experimentations were carried out elsewhere [1]. The effect of surface tension on bubble diameter and ultimately on overall gas holdup was also investigated by introducing a certain quantity of surfactants in the above system. Simulations have been performed for various values of superficial gas velocities in the range of 1-8 cm/s. The gas holdup found by simulations, have been compared with experiments, showing a maximum deviation of 4 % which is generally acceptable for this type of system. It is found that overall gas holdup significantly increases with increasing superficial gas velocity. Also a decrease in surface tension has been found to increase the gas holdup appreciably.