1 Modeling U.S. oil refinery production effects on domestic supply and demand. Samantha Sancho-Herrera Advisor: Patrick Kennelly PSU GEOG 596A Capstone Project Proposal September 21, 2011

2 Introduction Petroleum energy is a key factor in our world economy. The U.S. imports over 50% of petroleum needed to meet domestic demand. This project proposes a GIS solution to aide the process of monitoring the balance of demand and supply of crude imports and refinery production in the U.S. market.

3 Global Oil The U.S. is the top oil consuming country in the world but ranks third in oil production. This imbalance creates an opportunity for imports to meet domestic demand. Background Objectives Proposed Methodology Deliverables Project Timeline References Global oil consumptionGlobal oil production Data source

4 Major Global Producers and Consumers Background Objectives Proposed Methodology Deliverables Project Timeline References Central & South America Consumption / Production Ratio Middle East Africa Eurasia Canada United States Asia & Oceania Europe Data Jan thru June 2011 Data source

5 U.S. Import Lines Background Objectives Proposed Methodology Deliverables Project Timeline References Central & South America 19% Africa 17% Asia & Oceania 3% Eurasia 3% Middle East 16% Europe 19% Canada 23% Data Jan thru June 2011 Top 5 countries for U.S. Imports Canada 23% Mexico 11% Saudi Arabia 11% Algeria 9% Venezuela 9% Data source

6 U.S. Data Districts The United States is divided into five Petroleum Administration for Defense Districts, or PADDs. These were created during World War II under the Petroleum Administration for War to help organize the allocation of fuels derived from petroleum products. PADD 1 on the east coast is further divided into sub-regions as shown below. Hawaii and Alaska are not shown but are included in the west coast region. Today, these regions are still used for data collection purposes. (U.S. Energy Administration) Background Objectives Proposed Methodology Deliverables Project Timeline References

7 U.S. Imports and Exports UOM Million of Barrels Data source U.S. Imports U.S. Exports Background Objectives Proposed Methodology Deliverables Project Timeline References Data Jan thru June 2011

8 U.S. Supply and Demand U.S. Supply U.S. Demand Data source UOM Million of Barrels Background Objectives Proposed Methodology Deliverables Project Timeline References Data Jan thru June 2011

9 Products Background Objectives Proposed Methodology Deliverables Project Timeline References Crude Oil Natural Gas Liquids (NGL ) Finished Petroleum Products Hydrogen/Oxygenates Supply Demand–Refined Products

10 Gasoline Market Regions Data source Background Objectives Proposed Methodology Deliverables Project Timeline References Data Jan thru June 2011

11 Objectives Develop a user friendly GIS knowledge sharing market analysis tool for use by traders, coordinators and market analysts in the petroleum industry. Create an interactive GIS solution to show the effects of decreased refinery production or storage fluctuations on supply lines and market areas. Provide the users the ability to input increases or reductions in refinery production or storage for a specific product and calculate the resulting effects on supply lines and market areas. Background Objectives Proposed Methodology Deliverables Project Timeline References

12 Proposed Methodology Data Sources NationMaster  Tabular data by country U.S. Energy Information Administration  Graphs by region  Tabular data by region, country and PADD  Tabular data for refinery production by PADD and product ESRI  Shapefiles for countries and states Other  Interviews with petroleum industry market analysts  Literary review of publications on petroleum industry trends Background Objectives Proposed Methodology Deliverables Project Timeline References

13 Merge state layers into PADD regions. Join refinery shapefile with tabular production data. Create shapefiles for product market regions. Create shapefiles for refinery to market region supply lines. Develop model to reflect changes in supply lines based on refinery production and storage capacity. Background Objectives Proposed Methodology Deliverables Project Timeline References Data Processing

14 Data Attributes Background Objectives Proposed Methodology Deliverables Project Timeline References Refinery Market Region Product Production Capacity Storage Capacity Inputs Output Market Region Refinery Product Intake Outflow Supply Line Market Region Product Refinery Refinery Input Market Region Input

15 Insert Refinery location Map Background Objectives Proposed Methodology Deliverables Project Timeline References U.S. Refineries As of January 2011 there were 148 refineries, 137 operating and 11 idle.

16 Flex API Software Template Software Platform --- ESRI ArcGIS Viewer for Flex Background Objectives Proposed Methodology Deliverables Project Timeline References

17 Flex API Widgets Background Objectives Proposed Methodology Deliverables Project Timeline References

18 Sample Mock-up Background Objectives Proposed Methodology Deliverables Project Timeline References North Sea & Africa Canada

19 Deliverables Interactive web page with maps showing U.S. refineries with supply lines and market areas for specific petroleum products. Models for supply lines and market areas based on user input of domestic refinery production. Models will allow users to input refinery capacity and storage to represent increase or reduction in market supply. Background Objectives Proposed Methodology Deliverables Project Timeline References

20 Project Timeline Project proposal peer review 9/21. Web site proof of concept created by October 30 th. Initial functioning model in place by December 1 st. Final presentation to petroleum industry analysts December 12 th. Background Objectives Proposed Methodology Deliverables Project Timeline References

21 References U.S. Energy Information Administration Environmental Systems Research Institute (ESRI) (National Petroleum News) Background Objectives Proposed Methodology Deliverables Project Timeline References

22 Questions ?