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Parkland Fuel Corporation operates as a marketer, distributor, and refiner of fuel and petroleum products in Canada and the United States. The company has initiated

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Parkland Fuel Corporation operates as a marketer, distributor, and refiner of fuel and petroleum products in Canada and the United States. The company has initiated an expansion project to expand in Victoria, BC. Financial Data Production cost per barrel, $44.00, profit $11.00 per barrel. If each facility produces more than what the market requires, the production is stored at $5.00 per barrel. The expansion facilities will produce up to their maximum capacity. The company has committed to satisfy the market demand up to its full production capacity at each of its facilities. Options and Market Demand Facilities Daily Capacity (Barrels) FAC 1 Daily Market Demand (Barrels) 6,000 6,100 6,000 5,800 5,900 6.200 FAC 2 6,100 FAC 3 6,200 Probability 0.25 0.20 0.20 0.15 0.20 The CEO of the company, a veteran in the fuels refinery and distribution business has made the company one of the largest companies by implementing pessimistic policies aiming at minimizing payoffs and wants to continue with this approach for this project as well. The CEO has hired you as the project manager to recommend what type of facility to build

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