Pipeline Project Evaluation

Fall 2016
Authored By: Brandon Whiting
Summary/Intro
The pipeline project is complex with several variants to account for including
costs of delays, encountering less-than-ideal geographic features and costs
incurred should right of eminent domain be utilized. In short, using a bruteforce method is unwieldy and inefficient. However, using more advance
techniques yields an elegant and efficient result that will optimize the return
on the Companys dollar.
Cost of Running Pipeline Explicitly on BLM Property
Case 1:
In case 1, the plan dictates that the pipeline skirt the perimeter just outside
privately-owned land, travelling West from the Extraction Site for 8 miles,
turning South for 16 miles, and turning East for the remaining 40 miles to the
Refinery. The below equation represents the total distance of the pipeline in
this scenario.
As we would be strictly on BLM ground, price per mile is $480,000 per mile.
Using this cost figure, the total cost of this plan is represented below.

Case 2:
In case 2, the plan dictates that the pipeline skirt the perimeter just outside
privately-owned land, travelling East from the Extraction Site for 32 miles

and turning due-south for 16 miles before arriving at the Refinery.

In this plan, the pipeline runs through the mountain adding additional cost to
the project. The additional costs are modelled below, accounting for drilling,
8 months of downtime and study costs.

Cost of Running Pipeline Utilizing Private Land

Case 1
This proposal requires that the shortest distance be taken from the
Extraction Site to the Refinery. This distance was solved for, as follows:

As all of this distance is on private land, we can use this function to arrive at
total cost:

Case 2
This proposal dictates that private land is used, but only the bare minimum.

This necessitates running pipe due South from the Extraction Site through 16
miles of private land before turning East for the remaining 32 miles. This
requires two separate cost functions based on distance over private land and
distance over BLM land. See below for total distance, costs of private and
BLM portions of pipeline and total cost.

Minimization of Costs Incurred

The last request was the minimization of costs based on crossing through
private land at some angle, intersecting the Southern border and continuing
East the remaining distance to the refinery. Well be using a new set of
formulas based on this diagram.

As you can see, were now making our model dependent on theta, rather
than a distance in miles. As such, we need new equations to calculate our
unknown distances. These are:

Using these new distances, we can use our previous equation for total cost

and substitute our equations for xp and xb to make our new C(theta) function
representing total cost.

Based on the map diagram, we can impose an artificial domain of:

From here, its possible to take the derivative and analyze to find our
minimum cost:

As neither of these factors will ever equal zero, our function will never equal
zero. This means that the slope of the function is either always positive or
always negative throughout the domain. Picking an arbitrary value within
the domain will reveal which and, subsequently, reveal theta value for the
minimum cost. As zero is within our domain, well use that as our test input
into the function.

From our result, we know that the slope is negative throughout the entire
domain. This means that our lowest cost value exists at the maximum of our
domain, namely tan-1(2). Well plug this value into our formulas to glean the
length of pipeline on private land and how far from the refinery it intersects
BLM land.

Reflection
Ive found Calculus to be the most interesting math class Ive taken.
Manipulating functions and their derivatives to optimize models based on a
given parameter has applications ranging from ordering office supplies to
finding the most fuel-efficient RPM range for a given motor. Because it has
such wide-ranging applications, it can be used virtually anywhere and is
extremely useful. I look forward to using these concepts to better engineer
computers to be more power-efficient, more powerful or just run a simple
loop more efficiently.