Math 1210 Pipeline Project

Written Report by Calvin Dam & Aaron Lovell

Dear CEO you have given me and my partner Aaron a great project for
us to solve. The project consists of finding different scenarios of ways to build
our pipeline from an oil well to a refinery. Our goal was to figure out the total
cost of constructing the pipeline by adding the different cost depending on
what choices we make regarding the pipeline.
To determine the cost for the case of running the pipeline strictly on BLM
ground from west, then south, then east to the refinery, we must figure out the
distance from the well to the refinery. We take the 4 miles heading west, 12
miles heading south, and 36 miles running east for a total of 52 miles. We then
take that 52 miles and multiply it by the cost $500,000 per mile if we ran
across BLM land. The total cost we calculated was $26,000,000.

To determine the cost for the case of running the pipeline only on BLM
land in the direction of east through the mountain and then south to the
refinery we must calculate the miles and add the cost of drilling through the
mountain. The well heading east to the refinery is 32 miles plus the 12 miles
heading south to the refinery makes the total distance 44 miles. The cost of
drilling through the mountain would add a flat fee of $2,000,000. In addition
BLM will require an environmental impact study before drilling through the
mountain which will cost $320,000 and it will delay the project by 4 months
costing another $120,000 per month. We take that cost of $2,000,000 plus
$320,000 plus $120,000 times the 4 months it will take before we can start
drilling. That makes the total cost of drilling through the mountain $2,800,000.
Now we add the cost of installing the pipeline across 44 miles of BLM land
which is $500,000 per mile. The cost of that pipeline will be $22,000,000. Now
we add the cost of the pipeline plus the cost of drilling through the mountain
for a total cost of $24,800,000.

To determine the cost of running the pipeline across private ground, we

must calculate the distance from the well to the refinery. We know that the
distance if we head east to the refinery is 32 miles and that if we head south it
would be 12 miles. Using Pythagorean Theorem we square 32 miles and square
12 miles and add those two numbers together. Then we take the square root of
that sum and that will be the total amount of miles from the well directly to the
refinery. The total miles would be about 34.176 miles or for the exact answer
would be 4 times the square root of 73. Now to calculate for the cost we take
$500,000 per mile plus the additional cost of having to build across Private

Grounds which is $350,000. So we take $850,000 multiply by 4 times the

square root of 73 for a total cost of $29049612.7

To determine the cost of building the pipeline south from the refinery
(directly south) across private grounds then east to the refinery we must once
again find the total distance and then multiply it by the cost. The distance
heading south is 12 miles of Private ground and the distance heading east is 32
miles of BLM land. Now to calculate the cost we take the 12 miles times the
cost of building across private grounds which is $850,000 for a cost of
$10,200,000. Next we take the 32 miles times the cost of building across BLM
land which is $500,000 per mile for a cost of $16,000,000. Now we add both
costs to find the total cost of having to build directly south then east.
$10,200,000 plus $16,000,000 for a total cost of $26,200,000.

To find the cost function of having to head south through Private Ground
and then head east across BLM land we must find an equation that relates the
variables. There are 2 halves to the cost function. The first half of the equation
is the cost of building across Private Ground times the distance heading across
Private Grounds down to BLM land. The second half of the equation would be
the cost of building across BLM land times the distance heading east to the
refinery. The cost of building across Private Grounds would be $850,000. To
solve for the distance heading down. (Or as I call the distance y) We must use
Pythagoras Theorem to solve for the distance. We take 12 miles squared plus
the distance of heading east across BLM land until it meets up with the
endpoint of y (A.K.A. x) squared then take the square root of the sum of
those two numbers to solve for y. To find the second half of the cost function
we take the cost of building across BLM land which is $500,000 times the
distance heading east to the refinery. To find the distance heading east you
must take x from when we were solving for y and then take 32 minus x.
We then times the distance by the cost to get the total cost of building across
BLM land. We then add the total cost of building across Private Ground plus the
cost of building across BLM land to find the total cost. Which is shown in the
function: ($850,000)*SQROOT(x^2+12^2) + ($500,000)*(32-x)

We took the derivative of the cost function we found in problem c. Then

we used the first derivative test by setting the derivative of the cost function
equal to zero and then solving for x. x is 8.728715609. We then take x and plug
it into the Pythagoreans theorem function we have and then solve for y to find
the optimal distance heading across private grounds to the southern border of
BLM land. Then we take 32 and subtract it by x to get the optimal distance
from the end of y across BLM land to the refinery. Then we plug in the

variables into our cost function to find the most optimal cost. So itll look like
this (y=SQROOT (12^2 +8.728715609^2) y=14.8388. (328.728715609)=23.2713. ($850,000*14.8388)+
($500,000*23.2713)=$24,248,630.