Conference on Supply Chain Management and Competitiveness (SCMCC-08) October 18 th -19 th 2008 Institute of Management Education Sahibabad, Ghaziabad, India

LOGISTICAL COST OPTIMIZATION THROUGH APPLICATION OF PTP MODEL (With special reference to Downstream Petroleum Supply Chain) Authors H. M. Jha “Bidyarthi” Professor Department of Business Administration and Research Shri Sant Gajanan Maharaj College of Engineering Shegaon, Maharashtra, INDIA Email; [email_address] , [email_address] And L. B. Deshmukh Lecturer Department of Business Administration and Research Shri Sant Gajanan Maharaj College of Engineering Shegaon, Maharashtra, INDIA Email: [email_address] Cell: 9420694924

These Processes, illustrated below in Figure 1, provide the basic framework for the conversion and movement of raw materials into final products.

Logistics Decisions Source: Logistics Composite Modeling, H. Donald Ratliff, Atlanta,

Petroleum Value Chain and the Value Search Source: Strategic Shift in Indian Downstream Sector Technologies in Supply Chain Management ;August 2005 by: Ashish Gaikwad, Director – Advanced Solutions,Honeywell Asia Pacific

Source: Strategic Shift in Indian Downstream Sector Technologies in Supply Chain Management ;August 2005 by: Ashish Gaikwad, Director – Advanced Solutions,Honeywell Asia Pacific

Solution Approaches: Individual Models for following problems:

PTP Model for Supply Chain Optimization PTP Model by Dubravko Hunjet, Miroslov Milinovic, Luka Neralic & Lajos Szerovicza; 2002

The mathematical formulation (1.1) – (1.6) of the production transportation problem uses the following notations: i  index for refineries (i = 1,2,……,I) j  index of petroleum products’ retailer / petrol pumps (j = 1,2,……,J) t  index for products (t = 1,2,………T) s  index for modes ( s = 1,2,……,S i , i = 1,2,…….,I) c is  Variable production costs for mode s at plant i c ijt  Unit transportation cost for product t from plant i to customer j a its  Quantity of product t produced at plant i by mode s b jt  Demand of product t by customer j; u ijt  A variable denoting amount of product t shipped from plant i to customer j z is  A variable denoting the intensity of using s by plant i