🇺🇸United States

Poor network investment and operations decisions from lack of accurate schedule‑based analytics

3 verified sources

Definition

Vendors emphasize that integrated scheduling suites enable better operational and financial evaluation of new or modified assets, indicating that prior to such tools, companies struggle to accurately assess capacity, bottlenecks, and cost impacts of changes.[3] Academic models similarly show that detailed scheduling is needed to understand true pumping, inventory, and interface costs across a pipeline network.[4][6]

Key Findings

  • Financial Impact: Misjudging true bottlenecks can lead to misallocated capital—e.g., a $50–200M pipeline looping or tank project built in the wrong place, or under‑investment where it is truly needed—and to ongoing operating costs from failing to address real constraints; even one such misinvestment can create tens of millions of dollars in value destruction over its life.
  • Frequency: Annually
  • Root Cause: Incomplete or poor‑quality scheduling data and limited scenario modeling capabilities cause management to rely on averages and heuristics rather than detailed network simulations when deciding on expansions, debottlenecking projects, or contract structures.[3][4][6]

Why This Matters

This pain point represents a significant opportunity for B2B solutions targeting Oil and Coal Product Manufacturing.

Affected Stakeholders

Midstream asset planners, Capital projects and strategy teams, Pipeline and terminal optimization groups, Executive leadership and board members

Deep Analysis (Premium)

Financial Impact

$10-30M in contract penalties for service failures; $5-20M in lost new business due to inability to demonstrate reliable capacity • $10-30M in lost aviation fuel contracts; $5-15M in contract penalties if capacity assumptions were wrong • $10-30M in lost contract opportunities due to inability to demonstrate capacity; $5-15M in competitive bids lost to competitors with better visibility

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Current Workarounds

Annual gut-feel projections; informal usage tracking; historical 'peak day' assumptions; PowerPoint presentations based on anecdotes; email back-and-forth with finance on capacity needs • Combination of terminal operator phone coordination, manual Gantt charts in Excel, WhatsApp group for last-minute changes, memory-based tracking of queue positions • Daily coordination calls with terminal; manual inventory spreadsheets; contingency plans for 'when supply gets tight'; reliance on fuel supplier relationships for advance notice

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Methodology & Sources

Data collected via OSINT from regulatory filings, industry audits, and verified case studies.

Evidence Sources:

Related Business Risks

Sub‑optimal pipeline and terminal schedules causing lost throughput and revenue

If scheduling optimization improves operational and planning efficiency by 41% and profitability by 51% for a Fortune 500 pipeline/terminal operator, even a conservative 5–10% under‑throughput on a 500,000 bbl/day network at $2/bbl margin equates to roughly $18–36M per year in lost contribution margin before optimization.

Excess pumping energy, drag‑reducing agent, and operating costs from inefficient schedules

Emerson reports that using PipelineOptimizer to reduce electric and DRA usage can "easily" save a pipeline operator substantial operating costs; on a 1,000‑mile liquids line, energy/DRA typically run into tens of millions of dollars annually, so a conservative 5–10% avoidable waste implies roughly $2–5M per year attributable to poor scheduling.[3][4]

Product contamination and interface reprocessing due to poor batch sequencing

Scheduling research for real‑world pipelines models interface contamination and reprocessing as a significant cost term; for a large refined‑products line, even 0.5–1% of shipped volume downgraded or re‑processed at $50/bbl value loss on 200,000 bbl/day implies roughly $18–36M per year of avoidable quality‑related costs if sequencing is not optimized.[4][6]

Delayed billing and revenue recognition from fragmented scheduling and accounting data

If scheduling integration improves profitability by 51% for a Fortune 500 operator and part of that is faster, more accurate billing and reduced disputes, a conservative estimate of 2–3 days reduction in average settlement on $1B of annual movements equates to financing and dispute‑related costs in the low single‑digit millions per year before optimization.

Idle pipeline and tank capacity from manual, non‑optimal scheduling

If operational efficiency increases by 41% after implementing optimized scheduling for a large pipeline/terminal network, even attributing only a fraction of that to added throughput suggests multi‑million‑dollar annual value; for a 300,000 bbl/day line, 3–5% avoidable idle capacity at $1.50/bbl tariff is roughly $5–8M per year in lost capacity monetization.

Regulatory non‑compliance exposure from inadequate scheduling visibility and reconciliation

Regulatory penalties for misreported volumes, tax irregularities, or imbalance violations can range from hundreds of thousands to millions of dollars per incident; recurring reconciliation deficiencies in a large midstream operator could plausibly expose them to multi‑million‑dollar risk over several years, though precise figures are case‑specific.

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