Optimum Integrated Design of Crude Oil Supply Chain by a Unique Mixed Integer Nonlinear Programming Model

• Published in: Industrial & engineering chemistry research 2017-05, Vol.56 (19), p.5734-5746
• Main Authors: Azadeh, Ali, Shafiee, Farideh, Yazdanparast, Reza, Heydari, Jafar, Keshvarparast, Ali
• Format: Article
• Language: English
• ISSN: 0888-5885; 1520-5045
• DOI: 10.1021/acs.iecr.6b02460

In this paper, a mixed integer nonlinear programming model is proposed to concurrently design two segments (i.e., upstream and midstream) of crude1 oil supply chain. The network includes all entities and their connections from oil wells to product depots. Furthermore, a real world example is applied to show the improved model application. Furthermore, a sensitivity analysis in which ±20% deviations at a time were placed on two parameters is presented. Also, model performance is analyzed with GAMS 22.6. The proposed multiperiod and multiproduct model consists of several decisions (i.e., oil field development, transformation, transportation, and distribution). The main contributions of this work are inclusion of all entities related to upstream and midstream segments and both oil field development and transformation planning, simultaneously. Finally, it is shown that a decrease in production cost of refinery products will lead to more net profit given all refinery production capacity are used. Also, increase in refinery production capacity will improve network net profit given new fixed cost investment is not applied (e.g., refineries and transportation modes). This is the first study that simultaneously considers and optimizes upstream and midstream of crude oil supply chain. Second, it presents a unique mathematical model. Third, all features and parameters are included. Fourth, it is practical and may be used for other crude oil supply chain.