A transshipment model for logistics management at Indian Oil Corporation

Abstract

Three refineries of the Indian Oil Corporation procure crude oil from suppliers, at production sites in the Persian Gulf, West Africa, North Africa, West Asia, and India. The crude oil is shipped to two ports in the state of Gujarat, India, by large tankers and medium sized vessels. From these two ports, the crude oil is pumped to the refineries via pipelines. The refineries have known capacity, that are different for the two types of crude oil. In this paper, the scaled-up problem has been modelled, as a transshipment network. Next, the concrete instance of the problem, has been solved using an LP solver. This was followed by post-optimality analysis of the solution. The flow values on all arcs, and optimal product mix, validate actual decisions. Precise shipping requirements obtained from the solution, are shared in advance with marine transporters to improve supply chain coordination.