Pipeline Project 2014

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 5 mile directly west and then 15 miles south and
finally 45 miles east to the refinery (see figure below). Cost for materials, labor and fees
to run the pipeline across BLM ground is $500,000 per mile.
Cost of drilling through the existing mountain would be a one-time cost of
$4,000,000 on top of the normal costs ($500,000 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 $550,000 and will delay the project
by 6 months costing the company another $120,000 per month.

Dear BLM CEO,

Since the drilling of natural gas wells near Vernal, Utah has been approved, I
have analyzed several different cost scenarios in order to find the cheapest one. Below
are diagrams and the equations I used to determine the cheapest way to run the gas
pipe. Thank you for this opportunity!
Kelcee Taylor
Initial Costs:
BLM ground: $500,000 per mile
Private ground: $850,000 per mile for right-of-way fees
Drilling through the mountain: One time cost of $4,000,000 + environmental impact study fee
Environmental Impact Study: $550,000 with six month delay (extra $120,000 per month)
Personal Calculus Reflection:
Of all the math classes I have taken, calculus has proven to be the most useful and
practical of them all. This project especially has shown me that people us calculus in everyday
jobs to solve real world problems. I have learned how to determine the velocity, acceleration,
and jerk just from a position graph as well as determining the optimal way to place things or
design things. Because of these things that I have learned over the last semester, I would
definitely argue that calculus is a useful tool and Im glad that it is one that I now have to use.

Option #1: One pipe running west, south and then east to the
refinery.
Pipeline Distance:
West 5 miles
South 15 miles
East 45 miles
Total 65 miles
C(65)= $500,000 x 65 miles

Cost = $32,500,000
Option #2: One heading east through the mountain and then south
to the refinery.
Pipeline Distance:
South 15 miles
East 40 miles
Total 55 miles
C(55)= ($500,000 x 55 miles) +
$4,000,000 (tunnel) + $550,000
(Study) + $720,000 (6 month Delay)

Cost = $32,770,000
Option #3: The shortest distance across the private ground to the
refinery.
Calculations:
402 + 152 = c2
1600 + 225 = c2
Running the pipe the shortest distance:
c = 42.72 miles
C(m) = $500,000(m) + $350,000 (private m)
Cost = $850,000 x 42.72 miles

Cost = $36,312,016

Option #4: Straight across the private ground, then straight to the
refinery.
Private Land:
15 miles
Cost
$500,000 + $350,000 = $850,000 per mile
$850,000 x 15 miles = $12,750,000
BLM Land:
40 miles
Cost
$500,000 x 40 miles = $20,000,000
Total Cost
$20,000,000 + $12,750,000

Cost = $32,750,000
Option #5: Optimal way to run the pipeline (minimize cost) / Part D

Solve for x
Plug into the cost function
Take the derivative
Set equal to 0 and solve for c

c= 18.54 Plug in to x equation

Plug x and c in to cost equation

This graph shows that using 42.62 will give us the cheapest option.
= [$850,000(sqrt 225 + )]! + [$500,000(40 )]

Cost = $30,309,000

The angle 126 degrees was found by using the law of cosines with three
sides of a triangle (18.54, 15, and 10.9) to get 126 degrees.