A deteriorating inventory routing problem for an inland liquefied natural gas distribution network

Yousef Ghiami*, Emrah Demir, Tom Van Woensel, Marielle Christiansen, Gilbert Laporte

*Corresponding author for this work

Research output: Contribution to JournalArticleAcademicpeer-review

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Abstract

Liquefied Natural Gas (LNG) is natural gas that is converted into its liquid state for logistical benefits. It is also becoming a more viable alternative energy source due to its price competitiveness and environmental friendliness. We study an inventory routing problem for inland distribution of LNG from a storage facility to several filling stations. Here, a transport planner is responsible for the inventory management at the storage facility and filling stations, as well as for the routing and scheduling of a heterogeneous fleet of vehicles. LNG evaporates at a constant rate over time at the storage facility and at the filling stations, and this characteristic relates to the inventory management problems with deterioration described in the literature. Therefore, the problem under study is denoted an LNG Deteriorating Inventory Routing Problem (LNG-DIRP). As a solution method, we propose a matheuristic that combines a mixed integer programming formulation and an adaptive large neighborhood search algorithm. Results of extensive computational experiments confirm the efficiency of the proposed solution method and provide managerial insights to promote LNG as an alternative clean energy solution for the future of transportation. Furthermore, we examine several replenishment policies that are of interest to practitioners and regulatory bodies.

Original languageEnglish
Pages (from-to)45-67
Number of pages23
JournalTransportation Research Part B: Methodological
Volume126
Early online date6 Jun 2019
DOIs
Publication statusPublished - Aug 2019

Funding

The authors gratefully acknowledge fundings provided by VU University Amsterdam, Dutch Institute for Advanced Logistics (Dinalog), Cardiff University, Eindhoven University of Technology, the Research Council of Norway through the Axiom project, and the Canadian National Sciences and Engineering Research Council under grant 2015-01689 . The authors are grateful to anonymous reviewers for their constructive comments and suggestions to improve the content and the presentation of this paper. Also, special thanks are due to Professor Hai Yang for his invaluable advice.

FundersFunder number
Canadian National Sciences and Engineering Research Council
Cardiff University
Vrije Universiteit Amsterdam
Technische Universiteit Eindhoven
Norges forskningsråd2015-01689
TKI Dinalog

    Keywords

    • Deteriorating item
    • Inventory routing problem
    • Liquefied natural gas
    • Matheuristic

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