(186p) Simultaneous Crude Procurement Planning and Movement Scheduling for Petroleum Refineries

The petroleum refinery production is a very complicated process, since huge volumes of crudes should be continuously handled through a highly integrated network of extremely intensive units. Nowadays, the refining process can be reliable and efficient with the aid of mature techniques, including advanced process control and real-time optimization. As comparison, crude procurement and crude supply are still vulnerable to tough missions and various uncertainties. Thereby, they will unavoidably affect the profitability and operating feasibility of refineries. The crude procurement cost is comparable to the operating cost in quantity, taking up a significant proportion of the overall cost [1]. On the other hand, the crude market has become highly volatile since the last two decades [2]. Thus, improper crude procurement in terms of amount and timing will inevitably reduce the profit margin of refinery, or even cause huge operating problems. Note that after the crude procurement has been planned, operations of different crude movement units including vessels, berths, storage tanks, pipelines and charging tanks have also to be well scheduled for a smooth and stable crude transfer, which involves complex scheduling problems. In previous studies, these issues were used to be addressed sequentially, providing separate crude purchase plans and crude movement schedules [3,4]. Some works studied a partial combination of crude purchasing and blending operations [5,6]. However, the two crucial elements have not been simultaneously considered in a full scope of crude supply chain.

In this study, a novel MINLP model with continuous-time representation has been developed with simultaneous consideration of crude procurement planning and crude movement scheduling. Through this model, the optimal procurement plan and transfer schedule can be efficiently determined towards the minimal overall cost. Optimal decisions on crude purchasing (i.e., types, volumes, and timing) and transfer operations (i.e., unloading, storing, blending, and charging) will be simultaneously and harmoniously obtained to accomplish economic and operable crude movement for petroleum refineries. In addition, realistic purchasing constraints, such as crude characteristics and shipping time, and process requirements, for instance tank inventory and blending specs have also been taken into account, so that the model applicability can be guaranteed. The efficacy and performance of the developed model has been tested and demonstrated through various case studies.

References

[1] Ji, X., Huang, S., & Grossmann, I., (2015) Integrated operational and financial hedging for risk management in crude oil procurement. Industrial & Engineering Chemistry Research, 54, 9191-9201.

[2] Chen, R., Deng, T., Huang, S., & Qin, R., (2015) Optimal crude oil procurement under fluctuating price in an oil refinery. European Journal of Operational Research, 245, 438-445.

[3] Kallestrup, K., Lynge, L., Akkerman, R., & Oddsdottir, T., (2014) Decision support in hierarchical planning systems: The case of procurement planning in oil refining industries. Decision Support Systems, 68, 49-63.

[4] Zhang, S., & Xu, Q., (2015) Refinery continuous-time crude scheduling with consideration of long-distance pipeline transportation. Computer and Chemical Engineering, 75, 74-94.

[5] Oddsdottir, T., Grunow, M., & Akkerman, R., (2013) Procurement planning in oil refining industries considering blending operations. Computer and Chemical Engineering, 58, 1-13.

[6] Zhang, J., Wen, Y., & Xu, Q., (2012) Simultaneous optimization of crude oil blending and purchase planning with delivery uncertainty consideration. Industrial & Engineering Chemistry Research, 51, 8453-8464.