A computational fluid dynamics (CFD) method is proposed for the analysis of the operation of a submerged electric arc furnace (EAF) used in the ferronickel production. The three-dimensional mathematical model was initiated for the time dependent solution of the fluid flow, heat transfer and electromagnetic phenomena. The physical properties of the slag, which has crucial role in the EAF operation were previously determined using classical molecular dynamics simulations and empirical relationships. The analysis revealed that the main slag properties affecting the EAF operation are the density, viscosity and electrical conductivity – the latter two being mutually dependent. The high electrical conductivity values of the slag favors melting via the high Joule heat produced within the slag region. Calculation of the dimensionless Péclet and Reynolds numbers revealed that the slag velocities play a decisive role in heat transfer and further indicate that the slag flow is laminar. The average slag velocity calculated 0.0001 m/s with maxima in the vicinity of the electrodes.