University of Engineering and Technology Peshawar

Department of Industrial Engineering

Jalozai Campus

Subject: Operations Research

(LAB)

Submitted to: Engr Muhammad Arshad

Submitted by: Zaka Ullah

Reg No #: 18JZIND0106
Lab 06(b)
To solve Blending & Oil Refining Model on LINGO

Objectives:
➢ To learn how to solve oil blending and refining problem on LINGO.
➢ To maximize the total profit resulting from the sale of all three grades of gasoline in the problem

Introduction:
A number of LP applications deal with blending different input materials to manufacture products
that meet certain specification while minimizing cost or maximizing profit. The input materials
could be ores, metal scraps, chemicals or crude oils, and the output products could be metal ingots,
paints, or gasoline of various grades.
LINGO is comprehensive tool design to make building and solving linear nonlinear quadratic
constrained second order cone, stochastic and integer optimization model faster easier and most
efficient.

Problem Statement
Shale Oil, located on the island of Aruba, has a capacity of 1,500,000 bbl of crude oil per day. The final
products from the refinery include three types of unleaded gasoline with different octane numbers (ON):
regular with ON = 87, premium with ON = 89 and super with ON = 92. The refining process encompasses
three stages: (1) a distillation tower that produces
feedstock (ON = 82) at the rate of 0.2 bbl. per bbl of crude oil, (2) a cracker unit that produces gasoline
stock (ON = 98) by using a portion of feedstock produced from the distillation at the rate of .5 bbl per bbl
of feedstock, and (3) a blender
unit that blends the gasoline stock from the cracker unit and the feedstock from the distillation tower. The
company estimates the net profit per barrel of the three types of gasoline to be $6.70, $7.20, and $8.20,
respectively. The input capacity of cracker unit is 200,000 barrels of feedstock a day. The demand limits
for regular, premium, and super gasoline are 50,000, 30,000, and 40,000 barrels respectively per day.
Develop a model for determining the optimum production schedule for the refinery.

Procedure:
First open the LINGO software a blank sheet will appear as shown in figure 6.1.
 Figure 6.1: LINGO Window

Write the objective function and constraints as shown in figure 6.2.

Figure 6.2: LINGO Syntax of Blending and Oil Refining Problem

➢ Click on “Solver” and select the “solve” icon. So, we got the result as shown in figure 6.3.
 Figure 6.3: Solution of the Blending and Oil Refining Problem

Conclusion:
In this lab we solve the blending and refining problem on LINGO. Also, we maximized the daily
total profit that is $875,000. LINGO is a little bit difficult compared to TORA to solve a problem.
LINGO gives only the algebraic solution. The solution shows that regular gasoline production is
20,000bbl/day short of satisfying the maximum demand. The demand for the remaining two grades
is satisfied.