49680: Value Chain Engineering Systems - Engineering the Supply Chain of BarCo Corporation - Engineering Assignment Help

Assignment Task:

Objectives addressed by this Assignment;

• Understand the business problem from the perspective of supply chain and operations management lens such as - Supply, Demand, Sustainability and Decision Making.
• Determine Strategic Options/recommendations and quantify the benefits (tangible and intangible) and the risks to achieve the expected outcomes.
• Apply research skills and appropriate methodologies to solve optimisation problems

Problem Context:

The General Manager of BarCo Corporation, received notification from MaxEnergy that natural gas supplies were being rapidly depleted. In the event of a shortage, MaxEnergy, the main producer and distributor of natural gas in the region, would allocate gas to its customers under the following provisions established by the Federal

Commission: First Priority: Residential and commercial heating and cooling Second Priority: Commercial and industrial firms that use natural gas as a source of raw material Third Priority: Industrial firms that use natural gas as a boiler fuel In the communication, it was mentioned that most of BarCo's uses were in the second and third priority classifications. Hence, BarCo would probably be subjected to "rolling brownouts", temporary and periodic curtailments of natural gas supplies. MaxEnergy planned to monitor its pipeline pressures and order reductions to maintain minimum levels. MaxEnergy preferred that its customers initiate the reduction process to minimize the effect on their industrial processes. MaxEnergy was authorized, however, to curtail supplies unilaterally if pipeline pressure fell below minimum levels. The natural gas shortage was created by the unprecedented heat wave/bushfires of the summer of 2019. Electrical generating plants were operating at capacity to supply electricity to operate air conditioning and refrigeration units. Although, long-range plans called for these utility companies to convert to coal, oil, or nuclear fuel, natural gas remained the dominant boiler fuel. CURTAILMENT PLAN BarCo's problem was to determine which of its products would be least affected by the gas curtailment. All of the BarCo complexes would be included in the curtailment region in the event of a brownout. Except for BarCo's ammonia operations, all gas purchased was used as boiler fuel. In its ammonia plant, gas was used as a source of raw materials. The manufacture of ammonia uses natural gas in the steam reforming process. In a detailed discussion with the CEO of MaxEnergy, BarCo learned that MaxEnergy would not specify the products to be curtailed. The curtailment procedure would be based primarily on a customer's usage pattern. Hence, BarCo had the flexibility to absorb curtailments where they would have minimum impact on profits.

Tasks (To be included in the Report):

1. Define the business problem and come up with a technique which can be helpful in analyzing this situation

2. Formulate and resolve situations for 20 and 40% curtailment of natural gas usage

3. Formulate and resolve distribution plan from MaxEnergy to BarCo for 40% curtailment scenario

4. Based on your analysis, provide a discussion on BarCo’s options and your recommendations for (i) the production and (ii) distribution plan; during the curtailment scenario

5. Conduct the sensitivity analysis for baseline scenario and describe the key outcomes (for both production and distribution plans) in simple terms for the top management

6. Profit margins for products from BarCo has a lot of fluctuations due to global volatility in Oil and Natural gas prices. Provide your recommendations for the management in terms of the impact of such changes on the production plans. Note: To be successful in this assignment you need to exhibit analysis of your research in all your discussions, and then the deductions resulting from that analysis.

Tasks (To be included in the Video):

1. Describe the problem with appropriate level of details

2. Identify and justify the analysis method chosen to solve this problem

3. List down key assumptions that were used while solving this case study

4. Provide a summary of results obtained from the analysis and key recommendations

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