• All the processing plants to be considered
• The yield from each plant
• The product and feed stream properties
• All the possible routing of the streams
• All the possible final blending recipes
• Utility and operating requirements for each process on a unit throughput basis
• Investment cost for each process
These data are coded and the coded items used in equations that represent all
the relationships to one another. The coded data items are shown graphically in
Fig. 11. The relationship equations representing physical and financial data are
inputs to the computer program. Proprietary subroutines included in the program
resolve nonlinear relationships to linear. Such routines as the DCF calculation
are also added into the main program. The computer solves the many hundreds
of equations meeting the problem premises and any other applied constraints.
The selected configurations are optimized within the program, and the final
printout shows product quantities, product quality, stream flows, unit capacities,
investment costs, operating cost, and the ROI. The graphical representation
of the model, part of which is shown here as Fig. 11, contains 511 variables and
over 400 equations. By present linear program standards, this is a fairly small
model.
Appendix 12 provides a detailed discussion and example of a linear program
application.
Common Terms and Expressions Used in Standard Economic
Analyses
Introduction to Economic Terms and Expressions
This section provides a summary of common terms and expressions used in
standard economic analyses. In this introductory economic analysis, we cover
two main subjects:
Economic analysis at one point in time
This “instantaneous” analysis is the most common since it entails the least
difficulty and requires the least amount of information. This is the type of
analysis seen in Chem Systems’ PERP reports and in SRI’s PEP reports. If
properly done and properly used, the results derived from this analysis are
excellent. In this write-up, we devote most of the attention to this analysis; in
particular, we try to analyze each of the terms in detail. Although this analysis
requires the least information, in order to do a proper job, the amount of
information required is usually still beyond what is commonly available in the
initial screening stages of a project. However, the insight provided by examining
Petroleum Refinery Planning and Economics
741
• The yield from each plant
• The product and feed stream properties
• All the possible routing of the streams
• All the possible final blending recipes
• Utility and operating requirements for each process on a unit throughput basis
• Investment cost for each process
These data are coded and the coded items used in equations that represent all
the relationships to one another. The coded data items are shown graphically in
Fig. 11. The relationship equations representing physical and financial data are
inputs to the computer program. Proprietary subroutines included in the program
resolve nonlinear relationships to linear. Such routines as the DCF calculation
are also added into the main program. The computer solves the many hundreds
of equations meeting the problem premises and any other applied constraints.
The selected configurations are optimized within the program, and the final
printout shows product quantities, product quality, stream flows, unit capacities,
investment costs, operating cost, and the ROI. The graphical representation
of the model, part of which is shown here as Fig. 11, contains 511 variables and
over 400 equations. By present linear program standards, this is a fairly small
model.
Appendix 12 provides a detailed discussion and example of a linear program
application.
Common Terms and Expressions Used in Standard Economic
Analyses
Introduction to Economic Terms and Expressions
This section provides a summary of common terms and expressions used in
standard economic analyses. In this introductory economic analysis, we cover
two main subjects:
Economic analysis at one point in time
This “instantaneous” analysis is the most common since it entails the least
difficulty and requires the least amount of information. This is the type of
analysis seen in Chem Systems’ PERP reports and in SRI’s PEP reports. If
properly done and properly used, the results derived from this analysis are
excellent. In this write-up, we devote most of the attention to this analysis; in
particular, we try to analyze each of the terms in detail. Although this analysis
requires the least information, in order to do a proper job, the amount of
information required is usually still beyond what is commonly available in the
initial screening stages of a project. However, the insight provided by examining
Petroleum Refinery Planning and Economics
741