Question: Nortex Chemicals, Inc. is involved in the natural gas processing industry in the Texas Panhandle. One of its primary operations involves purchasing large tanks, each

Nortex Chemicals, Inc. is involved in the natural gas processing industry in the Texas Panhandle. One of its primary operations involves purchasing large tanks, each roughly the size of a rail car. of particular byproducts from natural gas processing. It further purifies these byproducts into a usable form, and then resells the tanks to industrial customers. Presently, Nortex is in possession of 16 tanks in Canadian, 12 tanks in Spearman, and 13 tanks in Vega. Ench tank must be shipped by truck to one of its processing centers, which are located in Dalhart, Pampa, and Canyon, for further refiuenent. The cost of shipment depends roughly on distance, but also takes into account the driver's salary (which is higher for routes that are difficult to navigate in a truck), the cost of fuel, and hazardous materials permit fees. The following table provides the total costs (in dollars) of shipping one tank from the suppliers to the processing centers: While the three processing centers are capable of processing any number of tanks, the number transported to Dalhart mist equal the mumber transported to Canyon, due to an existing agreement between Nortex and its transportation provider. After processing, the tanks will be shipped to customers in Stratford, Stinnett, Perryton. Claude, Hereford, and Chamning. The cost of shipment depends on metrics similar to those mentioned above. The following table provides the total costs (in dollars) of shipping one tank from the processing centers to the eustomers. Note that certain combinations of processing facilities and customers are not possible due to factors such as regional non-compete clauses; these are indicated by dashes. The current customer demands are: Stratford, 8 tanks; Stinnett, 10; Perryton, 6; Clande, 7: Hereford, 6 ; and Channing, 8 . Additionally, due to a competitor's bankruptcy. Nortex will be acquiring 7 tanks of procesced byproduets that are currently located at a yard in Morse. Because these tanks are already processed, a third-party company can ship these tamks directly to customers in Stratford (at a cost of \$357 per tank), Stimett (at a cost of $318 per tank), and Perryton (at a cost of $277 per tank) without needing to go through one of the processing centers. Nortex has partnered with you to conduct an analysis and to make a recommendation that will help it to increase prolitability by optimizing the performanoe of its natural gas byprodncts distribution network. In summary, you must develop a distribution network and the corresponding integer programming model, perform an appropriate analysis using Excel, recommend a distribution system to be implemented by Nortex, and present a formal business report discussing your findings and conclusions. To receive full crelit for this project, your business report must contain the following items, You may deviate from the given order if you desire; lowever, it is your responsibility to ensure that all required items are included in your submission and that the order is logical. All items must be typed unless otherwine specified. - A cover page with the name of all group members. You may work individually or in a group consisting of a maximum of five students. No names may be added to this cover page after suhmission, and individuals whose names have been handwritten will not be considered part of the group. - An executive summary of no more than ohe page summarizing the problem, the process used to solve the problem, and the major findings and recommendations based on your amalysis. - A network diagram showing the origins and their capacities, the hubs, the destinations and their demands, the possible connections, and their respective costs. The diagram must be fully labeled. The diagram may be hand-drawn, as long as it is legible. - An integer program formulation which is used to optimize the distribution system. You may choose to label the objective function and constraints, if desired. - The Excel spreadsheet containg your formulation, Solver setup, and the solution provided by Solver. (You will not receive credit for a solution that is manually coded without being found via Solver.) Make sure that the names of all group members are on the sprealsheet before submitting it. - A narrative diseussion of at least two pages explaining in detail the problem, the logic behind the choice of methodology used, the development of the integer program, the process of bow the analysis was performed, the possible issues in the model and the remedies for it, and the final decisions and recommendations, along with justifications. Your project will be asmessed on the quality of the writing, the appropriatenes of the process used, and the correctuess of your solution and reoommendations. Finally, please note that everyone in the class is submitting a report for the same project case. While you may ask other elassmates (and the instructor and TAs) for ideas or assistance, your work must be your own (i.e, individually or that of your group members). If multiple groups submit reports that are identical or sulficiently similir, based on the estimation of the imstructor, all parties in question will receive a score of 0 on this project and be subject to diseiplinary action for academie dishonesty, as indicated in the syllabus. Submission of a report using information from a previous term's case will result in a score of 0
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