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.
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