Production And Operational Management

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Analyze Marathon’s product process and determine which phase is open to the greatest number of efficiency improvements. Explain your rationale. Marathon Oil operates around the globe. They are one of the leading energy companies in the world. Marathon operates the majority of their refinery across the Midwest, Gulf Coast, Upper Great Plains and Southeast regions. Their refineries are strategically located in the United States, making them accessible to major markets. Based on the information shown on the video “The Time It Takes to Provide America’s Transportation Fuels” I think phase one is open to the greatest number of efficiency improvements. Since there is no storage capacity at the LOOP (Louisiana Offshore Oil Port), the crude oil is transported directly by undersea pipeline to either eight underground salt caverns with approximately 50 million barrels storage capacity or to 600 thousand barrels of above ground storage (www.marathonpetroleum.com). Lack of infrastructure slows down production. If Marathon puts an offshore port at the LOOP this can reduce the time involved in the production process. Marathon can increase the flow of crude oil by moving through pipelines and increase pipeline efficiency by shortening the time that it takes to transport crude oil. Also, they can improve the process by increasing the diameter of the pipe and speeding up the flow of crude oil. A parallel pine line should be laid to carry light density crude oil. Pipelines are generally the most economical way to transport large quantities of oil, refined oil products, or natural gas over land. Compared to shipping by railway, they have lower cost per unit and higher capacity. Although pipelines can be built under the sea, the process is economically and technically demanding, therefore the majority of oil at sea is transported by tanker ships. Another improvement is

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