Levitz Kaykeo

Math 1210

Pipeline Project

Salt Lake CC, Math 1210

Pipeline Project
The U.S. Interior Secretary recently approved drilling of natural gas wells near
Vernal, Utah. Your company has begun drilling and established a high-producing
well on BLM ground. They now need to build a pipeline to get the natural gas to
their refinery.
While running the line directly to the refinery will be the least amount of pipe and
shortest distance, it would require running the line across private ground and
paying a right-of-way fee. There is a mountain directly east of the well that must
be drilled through in order to run the pipeline due east. Your company can build
the pipeline around the private ground by going 8 miles directly west and then 16
miles south and finally 40 miles east to the refinery (see figure below). Cost for
materials, labor and fees to run the pipeline across BLM ground is $480,000 per
mile.
Cost of drilling through the existing mountain would be a one-time cost of
$4,500,000 on top of the normal costs ($480,000 per mile) of the pipeline itself.
Also the BLM will require an environmental impact study before allowing you to
drill through the mountain. Cost for the study is estimated to be $600,000 and will
delay the project by 8 months costing the company another $100,000 per month.
For any pipeline run across private ground, your company incurs an additional
$360,000 per mile cost for right-of-way fees.
Your company has asked you to do the following:
a) Determine the cost of running the pipeline strictly on BLM ground with two
different cases:
i)
One running west, south and then east to the refinery.
ii)
One heading east through the mountain and then south to the
refinery.
b) Determine the cost of running the pipeline:
i)
The shortest distance across the private ground to the refinery.
ii)
Straight south across the private ground, then straight east to the
refinery.
c) Determine the cost function for the pipeline for the configuration involving
running from the well across the private ground at some angle and
intersecting the BLM ground to the south and then running east to the
refinery. Use this function to find the optimal way to run the pipeline to

Levitz Kaykeo

Math 1210

Pipeline Project

minimize cost. Determine the length of pipe that runs across private land
and how far from the refinery it starts running on BLM land. Determine the
angle at which your optimal path leaves the well. Clearly show all work
including drawing the pipeline on the figure below. Make it very clear how
you use your knowledge of calculus to determine the optimal placement of
the pipeline.
d) Include a computer generated graph of the optimal cost function, C(x),
for this pipeline for any configuration involving crossing some private
ground as well as some BLM ground. Make sure to use the correct
domain of the function to scale your axes appropriately and to label the
minimum point.

BLM Ground

16 miles

BLM Ground

8 mile

Private Ground

40 miles - BLM Ground

Write up a report of your finding to submit to your companys CEO. This report
should include all steps for any math used to make determinations asked for
above as well as statements as to the costs to be incurred by each scenario.
Include any appropriate figures to make each scenario clear. Label the scenarios
as they are labeled above.
Expectations:
All of the mathematical steps will be shown and will be correct

All equations and formulas will be created using an equation editor

Use exact values, rounding costs to the nearest cent only after the
final calculation

Levitz Kaykeo

Math 1210

Pipeline Project

Each pipeline scenario will be clearly labeled on a computer

generated diagram showing the path that is being considered

Any variables you use will be clearly defined and shown in your
diagrams

The cost function graph will be accurately generated using

mathematical software

A word-processed explanatory narrative with correct spelling and

grammar will allow the reader to follow your process

Your report should be an exposition of your finest work and presentation.

a) Stay on BLM Land, with two different scenarios of running the pipeline.
1. Running west, south and then east to the refinery.

16 miles

BLM Ground

8 mile

BLM Ground

Private Ground
40 miles - BLM Ground
The cost for running the pipeline this route would be:
Cost = 8(480,000) + 16(480,000) + 40(480,000)
Cost = $30,720,000
2. Heading east through the mountain and then south to the refinery.

Levitz Kaykeo

Math 1210

Pipeline Project

BLM Ground

16 miles

BLM Ground

8 mile

Private Ground

40 miles - BLM Ground

The cost for running the pipeline this route would be:
Cost = (40 8)(480,000) + 16(480,000) + 4,500,000 +
600,000 + 8(100,000)
Cost = 32(480,000) + 16(480,000) + 8(100,000) + 5,100,000
Cost = $28,940,000
b)
There is always the option of running the pipeline directly from the refinery
to the well, across the Private ground, which is the shortest route but also has an
additional cost of $360,000 per mile on top of the original $480,000. This plan
would look like this:

BLM Ground

8 mile
16 miles

BLM Ground

32 miles
Private Ground

40 miles - BLM Ground

1. The cost for running the pipeline this route would be:

Levitz Kaykeo

Math 1210
2

C =32 +16

Pipeline Project

C =1024+256
C= 1280
C=16 5
Then find the cost
Cost =16 5 ( 480,000 )+16 5(360,000)

Cost =30,052,753.62
2. Straight south across the private ground, then straight east to the
refinery.

BLM Ground

16 miles

BLM Ground

8 mile

Private Ground

40 miles - BLM Ground

The distance across the Private Ground is only 16 miles, and only 32 miles back
to the refinery on BLM Ground. Some extra cost for those 16 miles, but overall
the 48 miles wouldnt cost as much as previous plans:
C=16($360,000+$480,000)+32($480,000)
C=$28,800,000

c) The optimal placement of the pipeline.

Levitz Kaykeo

Math 1210

Pipeline Project

BLM Ground

16 miles

BLM Ground

8 mile

Private Ground

40 miles - BLM Ground

To find the optimal placement of the pipeline lets state what we already
know:
Cost along x=480,000 x
Y =32x

Use Pythagoreans identity to find C

C( x )= 16 + ( 32x )
2

Cost alongC=840,000 162 + ( 32x )

Cost ( x )=840,000 16 2+ ( 32x ) + 480,000 x

2

domain = [0, 32]

The derivative of Cost(x) was derived as follows:

1

d
2
d
840,000 ( 256+ ( 32x ) ) 2 + 480,000 x
dx
dx
1
2
cos t ( x )=420,000 ( 256+ ( 32x ) ) 2 (2 ( 32x ) ) +480,000
'

Simplify:
cos t ' ( x )=

420,000(2 ( 32x ))

256+ ( 32x )

Set equal to zero and solve for x:

840,000(32x)

256+( 32x )

+ 480,000=0

+480,000

Levitz Kaykeo

Math 1210

840,000(32x)

256+( 32x )

=480,000

840,000(32x )
480,000 256+ ( 32x )2

=1

Simplify:
7( 32x)
4 256+ ( 32x )2

=1

Square both side:

2

256+ ( 32x )

42
2
72 ( 32x )

Let u = (32-x)
49u 2
=1
2
4,096+16 u
49 u2=4,096+16 u2
33 u2=4,096
u=

4,096
33

Replace u with 32 x
32x=
x=
x=

4,096
33

4,096
+32
33

4,096
+32
33

x 43.14

(Answer not in the domain)

Pipeline Project

Levitz Kaykeo

Math 1210

x=

Pipeline Project

4,096
+32
33

x 20.86

(This one satisfies our domain)

Insert into cost function:

4,096
4,096
4,096
Cost
+32 =840,000 16 2+ 32(
+32) + 480,000(
+32)
33
33
33
So the final cost for optimal placement is figured by solving,
+32)=$ 26,389,528.28
( 4,096
33

Cost

Now to figure out the rest of the remaining angles to give us a better picture and
a total distance we,
Solve for C:

( (

C 19.5

Solve for :
tan =

11.14
16

34.75
Solve for :
1

=180cos
124.94

11.14
19.45

))

4,096
C= 16 + 32
+ 32
33
2

Levitz Kaykeo

Math 1210

BLM Ground

8 mile
34.75

16 miles

BLM Ground

Pipeline Project

19.5

Private Ground

124.94

11.14
40 miles - BLM Ground
d)

C(x)=$480,000(32-X)+840,000(X2+256)1/2

20.86

Levitz Kaykeo

Math 1210

Pipeline Project

Mr. Kuralt,
CEO of Operations,
After surveying the project land with intense study and research here are
the files and reports that you have requested from me. In this report you will see
the five different options that we have to precede with our Vernal Pipeline Project.
With each different route and scenario I have included the following detailed
information regarding distance and costs. Overall we have five options: two of
which require us to stay on BLM land and the other three will require us to go
through private land.
Our first option is to run the pipeline West, South and then East to the
refinery through BLM land, avoiding the mountain. (Refer to figure a.1 above)
This route for the pipeline would have a distance total of 64 miles with a cost of
$480,000 per mile on BLM land. The total cost for running the pipeline this route
would total $30,720,000.
The second route takes us East through the mountain and the south to the
refinery, also through BLM land. (Refer to figure a.2) If we go with this route,
there will be $4,500,000 in expenses to drill through the mountain on top of the
$480,000 per mile of the pipeline. Along with that, they will require us to pay an
environmental impact study, which theyve quoted as approximately $600,000.
This study will set our operations back about eight months, costing us another
$100,000 per month. The total cost for this route would total $28,940,000.
The third route would take us South East and allow us to cut through
private land straight from the well to the refinery. (Refer to figure b.1) To run a
pipeline through the private ground will cost us $480,000 per mile with an
additional $360,000 per mile. Ive calculated the distance of which we would cut
through the private land above and it would cover 35.8 miles totaling a cost to us
at $30,052,753.62.
The fourth route would take us straight South across private ground, then
straight East to the refinery. (Refer to figure b.2) This route passes through
private ground for sixteen miles which will costs us an additional $360,000 that
well have to pay on top of the $480,000. It also crosses BLM land for 32 miles at
$480,000. The total costs for this route would be $28,800,000.

Levitz Kaykeo

Math 1210

Pipeline Project

Our fifth and final option, which happens to be the optimal placement of
the pipeline would be to go through private land before going East through BLM
land to the refinery. (Refer to figures c.1 and c.2) Although this route require more
distance for the pipeline I found this one to be most beneficial to our company
regarding time and costs. This route will cover 40.31 miles or pipeline and will
costs of a total of $26,389,560.26.
Please dont hesitate to call or email me if you have other questions regarding
our project.

Sincerely,
Levitz Kaykeo
Manager of Petroleum Engineer Department

Reflection
Being able to work on a real life problem like this shows the extent of
which calculus is utilized and how many companies can benefit from using
calculus to figure minimal costs or maximizing profits. With real life applications
like this we can take into account almost every aspect of any company to see
how they operate and how they decide on how to run their company using what
we learn in calculus to best benefit their decision making and the path and
direction they chose to go.