Multi-objective optimization model for a downstream oil and gas supply chain

Ahmed M. Ghaithan, Ahmed Attia, Salih O. Duffuaa*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

53 Scopus citations

Abstract

Oil and gas companies play an important role in the global economy since they supply a large portion of the necessary energy to the world. The optimal production of oil and gas should be performed in an integrated fashion for the whole supply chain. The downstream oil and gas supply chain (OGSC) has attracted the interest of many researchers due to its central role in the world economy. This paper develops an integrated multi-objective OGSC model for medium-term tactical decision making for the OGSC downstream segment. The selected objectives related to downstream activities are the following: minimize the total cost, maximize the total revenue, and maximize the service level. The model includes multi-period and multi-product inputs. The model is verified and solved using an improved augmented ε-constraint algorithm to generate Pareto optimal solutions. The model assists in assessing various trade-offs among different objectives and guides decision makers for the effective management of the downstream OGSC. The utility of the proposed model is demonstrated using a real case from a Saudi Arabian downstream OGSC. Sensitivity analysis is conducted to investigate the effects of input parameters on the set of Pareto optimal solutions. The model is expected to have a positive impact on the future management of this important component of the energy sector.

Original languageEnglish
Pages (from-to)689-708
Number of pages20
JournalApplied Mathematical Modelling
Volume52
DOIs
StatePublished - Dec 2017

Bibliographical note

Publisher Copyright:
© 2017 Elsevier Inc.

Keywords

  • Energy
  • Multiple objective optimization
  • Oil and gas supply chain
  • Pareto optimal
  • Tactical planning

ASJC Scopus subject areas

  • Modeling and Simulation
  • Applied Mathematics

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