Question
Bruce currently has 100,000 cf of gas in storage at Katy. Industrial customers in Joliet are offering $4.35 per thousand cf for up to 35,000
Bruce currently has 100,000 cf of gas in storage at Katy. Industrial customers in Joliet are offering $4.35 per thousand cf for up to 35,000 cf of gas. Buyers in Leidy are offering $4.63 per thousand cf for up to 60,000 cf of gas. Create a spreadsheet model to help Bruce answer the following questions.
Given the available capacity in the network, how much gas can be shipped from Katy to Leidy? From Katy to Joliet?
How much gas should Bruce offer to sell to Joliet and Leidy if he wants to maximize profits?
Is Bruce able to meet all the demand from both customers? If not, why not?
If Bruce wanted to try to pay more to obtain additional capacity on some of the pipelines, which ones should he investigate and why?
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