Transportation planning for petroleum products and integrated inventory management

This study addresses the scheduling of an oil derivatives transportation system by a multiproduct pipeline that connects a single refinery to a distribution center (DC) and that meets the customer demands on a daily basis by considering integrated inventory management at the DC and refinery. A batch sequencing method is presented, which leads to a mixed integer linear programming formulation for determining the optimal pipeline batch sequence and the timing of product deliveries to the DC. Operational restrictions are also considered such as the continuous or discrete flow rate and high peak electricity periods. The experimental results obtained for several examples, including a real-world multiproduct pipeline in different scenarios, demonstrate that the proposed model yields an optimal pipeline schedule with low computational costs.