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For a two-phase immiscible flow through a heterogeneous porous medium in gravity field but with neglected capillary pressure, a macroscale model of first order is derived by a two-scale homogenization method while capturing the effect of fluid mixing. The mixing is manifested in the form of a nonlinear hydrodynamic dispersion and a transport velocity shift. The dispersion tensor is shown to be a nonlinear function of saturation. In the case of flow without gravity this function is proportional to the fractional flow derivative and depends on the viscosity ratio. For a flow which is one dimensional at the macroscale, the dispersion operator remains three dimensional and can be calculated in an analytical way. In the case of gravity induced flow, the longitudinal dispersion as the function of saturation is negative within some interval of saturation values. Numerical simulations of the microscale problem justify the theoretical results of homogenization.