A gas lift system for a horizontal well is optimized by use of pressure/volume/temperature data combined with fluid and multiphase-flow correlations. After selecting the appropriate correlations, multiphase-flow calculations are made at various injection depths. A gas lift performance curve is constructed for the well by use of pressure- and temperature-survey data for the deepest point of injection. Solution nodal analysis is used to determine the optimum injection depth, valve spacing, wellhead pressure, and production rate as well as the minimum injection-gas volume.