Pipeline Project

Calculus 1210
Ethan Cox
Brad Johnson
Erick Saidi
April 27, 2015

Mr. CEO,
Below we have compiled the logistical analysis of building a pipeline from the oil reserves in the
Vernal, Utah area to our nearest refinery. We have concluded that buying rights to use the private
land between the rig and the refinery will be the most cost-appropriate route, but that the private
land should not be used to the maximum extent possible. We have considered other possibilities,
and have included the details of each option in our report.

A. If the decision is made to run the pipeline on BLM ground there are two options. The

costs of each are described below.

I.
The first option is to go west for 5 miles, then south for 15 miles, and then east for
45 miles. The total distance for option one is 65 miles at a cost of $500,000 per
mile, bringing the grand total to $32.5 million dollars.
II.
The second option for part A is heading east through the mountain, which has a
one-time cost of $3.5 million on top of the normal costs of $500,000 per mile. It
will also require an environmental impact study and will cost a total of $420,000
and delay the project for six months at a cost of $180,000 a month ($1,080,000).
This option has a total distance of 55 miles, and with all the additional costs
above, the total comes to $32.5 million dollars.
It is notable that the costs are the same for both options. There would be a time delay on
Option II because the impact study would take six months. Option II also has the risk of
the impact study coming back as not a viable option which would result in the loss of
$420,000 in addition to the six month delay.

B. If the decision is made to run the pipeline through private land there are two options.

I.

The first option is to run the pipeline straight to the refinery (shortest distance).
The distance is calculated using the Pythagorean Theorem. It would be a straight
line distance of 1825 miles (42.720 miles). The cost is $500,000 per mile for
construction plus an additional $350,000 per mile to purchase right of way,

bringing the total cost to $850,000 dollars per mile. This total cost is
$36,312,015.92 for this option.
The second option is to go straight through private property 15 miles south and
then east on the BLM land for 40 miles to the refinery. That is 15 miles at a cost
of $850,000 then 40 miles at a cost of $500,000. The total for this option would
be $32.75 million.

II.

Despite these options being the shortest distances, the cost of laying pipeline through
private property makes these options not viable.
C. In this section the information form parts A and B above are used to create an equation which will
determine the lowest cost path for the pipeline. The optimal or lowest cost path for the pipeline is
found through the derivative of the function. We will then confirm this is the cheapest route by
evaluating the derivative at its Critical Values to confirm the local minimum for the equation.
1)
) = $850000)  + 15 +
40 )$500000)

5)   =
6)

2)
) =   + 15 )/ 2)850000) +



3)

  

4)  =




1)500000)




  + 225

#
#

 =

7)   =



!  "


 
#


#

#



8)  = &

#

#


#

10.91

Distance from refinery to point of return to BLM line:

) = 40  = 40 &


#

29.09 miles
0) = $32,750,000

Check Critical Values

0) = $32,750,000

22500

01
2
10.91) $30,310,795.31
189

40) $36,312,015.92

The equation was used to identify the optimal distance and the lowest construction cost. The
lowest cost is $30,310,795.31. Part D below includes a diagram showing the optimal path through a mix
of private and BLM land. Also included is a graph which shows that the function identifies the cheapest
cost for construction of the pipeline.

D. The least expensive form to run the pipeline diagonally through private land 18.55 miles and
then 29.09 miles through BLM land. The total cost of this pipeline would be $30,310,795.31.

BLM Ground
BLM Ground
15 miles

5 mile
Private Ground
29.09 miles

10.91 miles
Distance X

This graph provides a visual illustration of the function

Cost of Using Private Land for Pipeline

37

Cost (million dollars)

36
35
34
33
32
31
30
0

10

20

30

Value of Distance X (Linear Miles)

40

Reflection
In our calculus class, weve focused much of our time on derivatives. In the real world,
derivatives can be used in engineering to help design a water retention basin to find the optimal
amount of surface area of the structure to contain the most volume. Mathematically, the
derivative makes possible something that wasnt possible in earlier math classes: finding the
slope of a curves tangent line. Weve also begun learning about integration and area under a
curve. This is useful in medicine in finding out how long a drug is effective in the body as a
function of the amount of the medication present. Calculus has greatly advanced other disciplines
as well, including physics, chemistry, and social sciences, and its safe to say that society would
be very different without it.