Plum, Christian Edinger Munk3; Neergaard Jensen, Peter4; Pisinger, David1
1 Department of Management Engineering, Technical University of Denmark2 Management Science, Department of Management Engineering, Technical University of Denmark3 Operations Research, Department of Management Engineering, Technical University of Denmark4 Maersk Oil Trading
The cost for bunker fuel represents a major part of the daily running costs of liner shipping vessels. The vessels, sailing on a fixed roundtrip of ports, can lift bunker at these ports, having differing and fluctuating prices. The stock of bunker on a vessel is subject to a number of operational constraints such as capacity limits, reserve requirements and sulphur content. Contracts are often used for bunker purchasing, ensuring supply and often giving a discounted price. A contract can supply any vessel in a period and port, and is thus a shared resource between vessels, which must be distributed optimally to reduce overall costs. The Bunker Purchasing with Contracts Problem has been formulated as a mixed integer programme, which has been Dantzig-Wolfe decomposed. To solve it, a novel column generation algorithm has been developed. The algorithm has been run on a series of real-world instances with up to 500+ vessels and 500+ contracts, and provide near optimal solutions. This makes it possible for a major liner shipping company to plan bunker purchasing on a global level, and provides an efficient tool for assessing new contracts.
Maritime Economics and Logistics, 2014, Vol 16, p. 418-435