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Optimal dynamic allocation of mobile plants to monetize associated or stranded natural gas, part II: Dealing with uncertainty

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  • Tan, Siah Hong
  • Barton, Paul I.

Abstract

Using the Bakken shale play as a case study, the previous part of this two-part series demonstrated how small-scale mobile plants could be used to monetize associated or stranded gas effectively. Here, we address the issue of uncertainty in future supply, demand and price conditions. To this end, we modified our multi-period optimization framework to a stochastic programming framework to account for various scenarios with different parameter realizations in the future. The maximum ENPV (expected net present value) obtained was $2.01 billion, higher than the NPV obtained in the previous part. In addition, the value of the stochastic solution was 0.11% of the optimal ENPV, indicating that the flexible nature of mobile plants affords them a great advantage when dealing with uncertainty.

Suggested Citation

  • Tan, Siah Hong & Barton, Paul I., 2016. "Optimal dynamic allocation of mobile plants to monetize associated or stranded natural gas, part II: Dealing with uncertainty," Energy, Elsevier, vol. 96(C), pages 461-467.
    • Handle: RePEc:eee:energy:v:96:y:2016:i:c:p:461-467
    DOI: 10.1016/j.energy.2015.12.069
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    References listed on IDEAS

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    Cited by:

    1. Hong, Bingyuan & Cui, Xuemeng & Peng, Donghua & Zhou, Mengxi & He, Zhouying & Yao, Hanze & Xu, Yupeng & Gong, Jing & Zhang, Hongyu & Li, Xiaoping, 2024. "Distributed or centralized? Long-term dynamic allocation and maintenance planning of modular equipment to produce multi-product natural gas based on life cycle thinking," Energy, Elsevier, vol. 288(C).
    2. Allman, Andrew & Zhang, Qi, 2020. "Dynamic location of modular manufacturing facilities with relocation of individual modules," European Journal of Operational Research, Elsevier, vol. 286(2), pages 494-507.
    3. Noor Yusuf & Tareq Al-Ansari, 2023. "Current and Future Role of Natural Gas Supply Chains in the Transition to a Low-Carbon Hydrogen Economy: A Comprehensive Review on Integrated Natural Gas Supply Chain Optimisation Models," Energies, MDPI, vol. 16(22), pages 1-33, November.
    4. Tan, Siah Hong & Barton, Paul I., 2017. "Optimal shale oil and gas investments in the United States," Energy, Elsevier, vol. 141(C), pages 398-422.
    5. Hong, Bingyuan & Li, Xiaoping & Song, Shangfei & Chen, Shilin & Zhao, Changlong & Gong, Jing, 2020. "Optimal planning and modular infrastructure dynamic allocation for shale gas production," Applied Energy, Elsevier, vol. 261(C).
    6. Hong, Bingyuan & Du, Zhaonan & Qiao, Dan & Liu, Daiwei & Li, Yu & Sun, Xiaoqing & Gong, Jing & Zhang, Hongyu & Li, Xiaoping, 2024. "Sustainable supply chain of distributed multi-product gas fields based on skid-mounted equipment to dynamically respond to upstream and market fluctuations," Energy, Elsevier, vol. 292(C).
    7. Hong, Bingyuan & Cui, Xuemeng & Wang, Bohong & Fan, Di & Li, Xiaoping & Gong, Jing, 2022. "Long-term dynamic allocation and maintenance planning of modular equipment to enhance gas field production flexibility," Energy, Elsevier, vol. 252(C).

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