In a gas condensate reservoir, a drastic pressure drop in the vicinity of the wellbore makes it subject to gas condensate drop-out. This phenomenon can adversely affect the productivity of the well and reduce gas recovery. The objective of this paper is to conduct a two-phase fluid flow simulation on two-dimensional porous media to understand the effect of the gas condensate drop-out on the gas relative permeability values. In order to do so, lattice Boltzmann (LB) modelling was applied as a computational fluid dynamics (CFD) approach to perform the simulations in homogeneous and heterogeneous porous structures. The developed model was constrained by periodic boundary conditions at inlet and outlet and bounce-back boundary condition at fluid-solid interfaces. It was shown that the model can appropriately monitor formation and movement of the condensate droplets as a result of the pressure drop as well as blockages due to the entrance of the droplets into the throats. A consistent decrease in gas relative permeability values with condensate saturation was observed. It was also indicated that the condensate droplets become mobile at higher critical saturations in the heterogeneous system due to the dominance of capillary forces over viscous forces in the less permeable areas. Such dominance results in more severe blockages in the heterogeneous systems, as the simulation results confirmed.