Question

An oil refinery in singapore receives crude oil from Arabia and refines it into gasoline that is sent to Malaysia (by truck capacity 15tons/wagon ).1 ton of crude oil is transformed into 0.75 tons of gasoline.Transport costs are $1000/truck , $25000/ship and $5000/wagon.Refining 3 batches of crude oil each of 50 tons takes 1 week.Production/week can either be 50 tons,100 tons or 150 tons.When the refinery places an order to Saudi Arabia , multiples of 1000tons of crude oil arrives in 2 months.Suppose the refinery has the next 12 weeks order from Malaysia,Thailand and colombia in tons (Djt:demand for malaysia,thailand,colombia in week t).Develop a model that optimizes crude oil purchase quantities,weekly production quantities, and number of trucks,ships and vagons sent every week to the mentioned destinations.Both gasoline and crude oil inventory are charged holding cost(h/ton-week,hh/ton-week).We wish to minimize cost over 12 weeks.

Use notation:X:gasoline production,I:gasoline inventory,IR:crude inventory,Order:crude order quantity,TR:transport quantity.Use discrete variable and subscript as necessary.

Answer 1