Optimization-based integrated decision model for smart resource management in the petrochemical industry

Abstract

In this study, a new decision-supporting platform for the overall supply chain management of the petrochemical industries was proposed to maximize business profits. The proposed system integrates various decision-supporting models that address the critical challenges, both vertically and horizontally. Specifically, horizontal integration includes various decision-based problems along with the productive flow on the value chain from raw material purchasing and manufacturing to the final product sales, while vertical integration involves critical decisions at different levels, including the enterprise supply chain, the plant scheduling/planning, and the process operation. The optimization-based decision platform effectively supports the business's supply chain management, plant planning, and process operation strategy. The platform integrates different decision and featuring models, including a price prediction and a paper trading model for reducing the financial risks, a mathematical model of naphtha thermal cracker for identifying the optimal operating, and an optimization model for maximizing business profits. As a result, business profit was improved by 5.30% with only paper trade optimization, 6.67% with optimal operating conditions combined with price forecasting, and 11.98% with overall supply chain optimization. Thereby, the proposed platform assists decision-makers in determining the timing and quantity of raw material purchases and final product sales, as well as the operation strategies for process facilities, utilities, and inventory management. This study could be used to aid in the establishment of annual planning and scheduling as an auxiliary indicator for business operations.