Strategic Planning Of Downstream Oil And Gas Logistics Distribution Network Via Bi-level Programming

Unprecedented Change in the Energy Industry supply and consumer demand is constantly influencing the logistic decisions.In China,across different regions and during seasons;supply and demand turn to conflict each other.Oil companies are face with network infrastructure problem in locating a facility and its distribution centers for marketing of their products.While consumers are constantly faced with the challenge of where to assign their demand that reduces cost.In this paper,a Bi-level programming model is proposed to investigate two players strategies in the refined product supply chain.And so,the model aims to determine the optimal facility location for oil companies in the upper-level,and determine the consumer optimal cost in assigning his demands to distribution center locations by using a particular transport mode.Our study investigated the model under two scenarios.The Multimodal and the Pipeline-based planning scenario.In the overall objective of the model in the base scenario,the total supply chain cost for multimode was ￥ 552.7 million,and the transfer volume was 3216 mil.ton/yr.In the results,rail account for almost 50%,pipeline 25%,while barge and truck covered 25% respectively.Whereas,the pipelinebased total supply chain cost was ￥ 456.6 million and the transfer volume using pipeline as the only mode of transportation is 3216 mil.ton/yr.The results of the multimode scenario and the pipeline-based scenario present an optimal solution for the refined product supply chain configuration.However,due to the deviation in the pipeline-based statistical analysis,it explains that the extreme variability in capacities will need further investigations.Finally in the research,a sensitivity analysis was done with configuration on consumption value.The result suggests that an allowable increase or decrease by ±20%would not change the optimal number of facility locations,but could incorporate a little change in the capacities.However,the number of allocation points remain the same as the base scenario.