Western Oil Limited (A)

Abstract

A typical problem in petroleum supply chains is to determine optimal jetty capacity. Western Oil Limited, a refinery in Western India was set for an expansion that would more than quadruple its capacity over the coming three years. This case examines how to expand the captive jetty capacity to match the projected refinery output in terms of volume and variety. An appropriate trade off between the cost of jetty expansion and demurrage due to ship delays had to be considered.