Infrastructure for natural gas production and processing often has a lifetime of 30 years and more. This means that the operational use of the infrastructure and the requirements for its design typically change over its lifetime. Strategic decision suppor t models for investment analysis need to capture the long term uncertainty and be able to value short term operational flexibility. In a dynamic sequence of initial investments, capacity expansion and new investments, the natural gas value chain is gradua lly developed over a long time horizon.
We have identified two industrial research cases where we already have some cooperation with Norwegian industry (Statoil, Hydro).
-Offshore natural gas value chains
-Investments in natural gas based energy system s infrastructure
We will analyse long term investments in infrastructure for these caes using the main methodologies:
-Large scale (non-convex) optimization
The main cooperation at MIT wil l be with prof. Paul Barton who is a specialist in large scale optimization, dynamic integer programming as well as process control and design (Selected references are included).
The modelling and solution methods developed in the project will focus o n:
-Merging stochastic programming methodology with ideas of integrated process design and operation of the gas value chain. Here mathematical models combining technology, contractual arrangements and markets are important
-Modelling and valuing operation al flexibility in long term investment analysis
-Investigate how short term flexibility is important for long term strategic decisions