Production Planning

Crude Oil Refining by its nature is a diversified and complex business model. Newer and specialized non-linear constraints such as volatility in oil prices, changing demand patterns for petroleum products, stringent environmental regulations related to clean fuels and start-up of new production technologies are continuously being embedded into the system resulting in more complex refining schemes.

In this context, intellectual production planning plays a vital role in maximizing refinery profitability and ensuring logistic reliability more so in the current day Refinery Downstream Model which oscillates its nature between a Supply-driven and a Demand-driven model.

Linear programming software such as Aspen PIMS, Haverly GRTMPS, Honeywell RPMS etc. becomes a handy planning tool to select crude, optimize product mix and to determine optimal operating conditions over a desired time-frame.

Oil Refinery

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Types of Plan

Long Term Plans

Revenue Budget and Annual Plans for estimating and planning the expenditure during the forth-coming financial year. These are also used to schedule turn-around of process units.

Short Term Plans

Monthly plan to optimize refinery’s operational activities for the current month, while keeping a view for the future requirements concerning the next three-month cycle. Typical flow of activities during the Short-Term plan regime is as depicted below:


  • Crude slate entirely fixed
  • 4 Week plan in Multi period
  • Emphasis on meeting product dispatch schedule, unit-wise operating philosophy & inventory management for the month as a guideline to scheduling group.
  • Crude slate more or less fixed sparing month end receipt term crude parcels left for optimization
  • Evaluation of export needs Vs crude cut
  • Other economic evaluations
  • Crude slate relatively flexible for grade selection within term crude basket
  • Indicate requirements for import, if any
  • Ideal month for Spot and Term crude evaluation

The base month plan for the current month never remains valid all through the month as unplanned aberrations in crude receiving program, demand variations and emergency shut-down of process units are bound to occur. This calls for a mid-month correction of the plan incorporating actual deviations from plan during the 1st half of the month and devise a revised plan to achieve the best in the remaining half of the month.

Planning Challenges

At this juncture, it is worthwhile to mention that the challenges involved in devising a robust plan are many. Following are partial list of these challenges:

  • Choice of the right set of prices to be used in LP (often derived as a function of both forecasted and actual available quotes) as these play a major role in optimization
  • Choice of right tool for planning that best suites the refinery needs
  • Availability and ease of receiving the necessary inputs for completing the planning process
  • Identification and incorporation of valid constraints from an exhaustive list that truly matter the most
  • Identification of cushion to cover for the operational inefficiencies such as in blending, unit start-up and shut-down plan, etc.
  • Application of an approach which is more practical rather than theoretical to avoid situations such a tea-spoon blending in product recipes
  • Accuracy of the LP model strongly dependent on the inputs from related tools such as Assay Data from simulation models fine-tuned unit-wise yield and limitations from rigorous reactor models, etc.
  • LP model inherent limitations such as assumption of linearity in refinery operations, local optima which may lead to incorrect decision-making
  • Need of both holistic (Multi-plant model) and atomistic approaches at Corporate and refinery level respectively

iOG Solutions for Refinery Planning

We at iOG Solutions are a team of consultants with rich and vast experience in deploying end-to-end solutions of Refinery Planning business process at refineries in Spain, Middle-East, Vietnam and various other client sites across the world.

What we offer:

  • Study the business process “As –is “
  • Provide road-map to achieve “To-be” status in-line with the best practices available world-wide
  • Implement Planning Business Process at client site through :
    • Proper design of functional scope & high level architecture
    • Identification, analysis and definition and integration of the right sources of data to carry out the analysis
    • Development of automated templates for handling data inflow and outflow
    • Setting up exhaustive list of case sets for Spot & Term crude evaluation, export evaluation, New product evaluation and other economic studies
    • Sophisticated trend charts for effective reporting to Top Management
  • Generate LP vectors through rigorous reactor models based on actual data to fine tune the LP model which shall subsequently be used to take “Make-Buy-Sell” decisions
  • LP Model review and identification of improvement opportunities
  • LP Model design and implementation
  • Implement multi-refinery and multi-period LP model
  • Define SCM KPI’s for visualization on the Top Management dashboard
  • SCM Integration with other relevant refinery solutions to ensure seamless flow of data, efficient analysis and elegant reporting.