In this paper, techniques have been developed to examine the enhanced swelling effect and viscosity reduction of CO2-saturated heavy oil with addition of rich solvent C3H8. Experimentally, PVT tests are conducted to measure the saturation pressure, swelling factor and viscosity of the C3H8-heavy oil system and C3H8-CO2-heavy oil system, respectively. It has been found that an increased swelling effect of heavy oil is obtained by adding rich solvent C3H8 into CO2 stream. An enhanced viscosity reduction of the CO2-heavy oil system is also achieved in the presence of rich solvents such as C3H8. Theoretically, two binary interaction parameter (BIP) correlations in Peng-Robinson equation of state (PR-EOS) have been proposed for respectively characterizing CO2-heavy oil systems and C3H8-heavy oil systems by treating each oil sample as a single pseudocomponent with its molecular weight and specific gravity. The BIP correlations together with the PR-EOS can be used to predict the saturation pressures and swelling factors of the C3H8-CO2-heavy oil systems with a good accuracy. Also, in comparison to other mixing rules, the Lobe’s mixing rule is found to be more appropriate for quantifying viscosity reduction of the heavy oil with dissolution of CO2 and/or C3H8.