Questions:
The Kodiak Oil Company owns a pipeline network that is used to convey oil from its source (Node 1) to several storage locations. A portion of the network is shown on the next page. Due to varying pipe sizes, the flow capacities vary (shown below in ‘000s of gallons per hour). By selectively opening and closing sections of the pipeline network, the firm can supply any of the storage locations.
a. If the firm wants to fully utilize system capacity to supply storage location 7, how long will it take to satisfy a location 7 demand of 1 million gallons?
b. What is the impact on the time to meet location 7 demand if pipeline 3-6 gradually reduces its flow to a maximum of 5000, 4000, and finally only 3000 gallons per hour?
Evaluate all parts using Excel Solver including the three scenarios in part b.
