Title: Optimisation of NGL rail car distribution

Authors: Robert A. Russell; Christopher Cox

Addresses: Collins College of Business, Finance and Operations Management, The University of Tulsa, USA ' NGL Energy Partners, Tulsa, OK, USA

Abstract: In this paper we address the optimisation of a rail-car natural gas liquids distribution and sales revenue supply chain. A network-based goal programming model is used to allocate rail cars to deliver contracted supply quantities from supply plants to regional demand terminals with different product prices. The planning horizon is one year broken down into months and includes futures prices of NGL products. The model incorporates terminal storage capacities, potential demurrage and detention constraints, and inventory carrying costs. The model integrates the distribution and transportation aspects of the problem. Results are reported for a Fortune 500 NGL company.

Keywords: revenue management; optimisation; NGL rail car distribution; goal programming; futures prices.

DOI: 10.1504/IJRM.2019.103019

International Journal of Revenue Management, 2019 Vol.11 No.1/2, pp.46 - 53

Received: 17 Feb 2018
Accepted: 17 Dec 2018

Published online: 14 Oct 2019 *

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