Integrated Planning of Industrial Gas Supply Chains

In this work, we propose a Mixed Integer Linear Programming (MILP) model for optimal planning of industrial gas supply chain, which integrates supply contracts, production scheduling, truck and rail-car scheduling, as well as inventory management under the Vendor Managed Inventory (VMI) paradigm. The objective used here is minimisation of the total operating cost consisting of purchasing of raw material, production, and transportation costs by trucks/rail-cars so as to satisfy customer demands over a given time horizon. The key decisions for production sites include production schedule and purchase schedule of raw material, while the distribution decisions involve customer to plant/depot allocation, quantity transported through rail network, truck delivery amounts, and times. In addition, a relaxation approach is proposed to solve the problem efficiently. An industrial case study is evaluated to illustrate the applicability of the integrated optimisation framework.