Optimizing petroleum redistribution in Sri Lanka: A cost-benefit transportation model

Nuwan Jayarathna

doi:10.14254/jsdtl.2024.9-1.9

Nuwan Jayarathna ⁽¹⁾

(1) Department of Scientific Computing, Faculty of Computing, University of Sri Jayewardenepura , Sri Lanka

https://doi.org/10.14254/jsdtl.2024.9-1.9

Issue
Vol. 9 No. 1 (2024)

Keywords:

vehicle routing problem, CEYPETCO, petroleum products, redistribution process, centralized redistribution method

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Abstract

This case study is based on Ceylon Petroleum Corporation, Sri Lanka, the national oil and gas company and market leader in Sri Lanka. The company’s outbound logistics consists of a centralized distribution method and a redistribution process of its products across the island. However, this study mainly focused on one regional depot and one petroleum product, Kotagala depot and Lanka Auto Diesel. The currently centralized redistribution process has noticed extra routing costs due to the unreasonable consumption of additional distance. This problem is modelled as a variant of the vehicle routing problem with a heterogeneous vehicle fleet. Our objective is to minimize the routing costs (or milk-run) by imposing constraints on the capacity and the volume. The researcher introduces a centralized vehicle routing problem that is presented. The proposed vehicle routing problem has been used to find the optimal path between clusters. The computational investigation highlights the cost savings that this new VRP can accrue. Cost savings can be accrued as large as 32.35% compared to a company's existing method.

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Authors

Nuwan Jayarathna

Department of Scientific Computing, Faculty of Computing, University of Sri Jayewardenepura

nuwand@sjp.ac.lk (Primary Contact)

Jayarathna, N. (2024). Optimizing petroleum redistribution in Sri Lanka: A cost-benefit transportation model. Journal of Sustainable Development of Transport and Logistics, 9(1), 121–136. https://doi.org/10.14254/jsdtl.2024.9-1.9

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