Optimizing Chevron’s Refineries
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Type
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Journal
Article
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Author
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Ted
Kutz
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Author
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Mark
Davis
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URL
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|
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Volume
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44
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Issue
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1
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Pages
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39-54
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Publication
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Interfaces
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Date
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February
1, 2014
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Abstract
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Chevron has developed a software modeling tool that
its seven company-owned refineries use to select the most profitable raw
materials, evaluate product options, optimize refinery processes, and promote
efficient capital investments. The tool is a linear program with distributive
recursion mathematics, which Chevron uses in operations and strategic
planning.
Over the past 30-plus years, the company has continually improved this application of operations research, and its complementary and supporting systems and business processes, and they are now deeply embedded into the fabric of Chevron’s downstream business of reliably and efficiently supplying products to its customers. The value that these efforts bring to Chevron now approaches $1 billion annually. Authors estimate that the cumulative value to Chevron over the past three decades is approximately $10 billion. |
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