Petroleum supply chain network design and tactical planning with demand uncertainty

L.J. Fernandes, S. Relvas, A.P. Barbosa-PĆ³voa
ABSTRACT:

The energy sector has dominated the world attention as recently arrived shale gas and slumping crude oil prices globally affect Petroleum Supply Chains (PSC). Fluctuating demand and prices are forcing companies to rethink existing distribution networks and production plans in order to improve network flexibility and cost efficiency. The current paper addresses this problem and presents a stochastic mixed integer linear program (MILP) for PSC design and planning under demand uncertainty that maximizes the expected net present value (ENPV) of a multi-entity multi-product PSC network. The decisions include locations, capacities, transport modes, routes, product affectations, inventories and fair-price costs and tariffs with economies of scale. The stochastic MILP designs a grassroots network with demand uncertainty for the Portuguese PSC, drawing important insights and research directions.

Publisher
Operations Research and Big Data IO2015-XVII Congress of Portuguese Association of Operational Research (APDIO) (Published)
Date
Oct, 2015
Keywords
Petroleum supply chain | Network design | Tactical planning | Stochastic MILP | Demand uncertainty | Expected value

ARE YOU INTERESTED IN A COLLABORATION ?

Whether you are looking for a research group to support you on your research topic or you have a difficult problem to solve, contact us and possibly start a collaboration

Contact us