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A New Formulation Based on Customer Delivery Patterns

for a Maritime Inventory Routing Problem
Jørgen Glomvik Rakke, Henrik Andersson, Marielle Christiansen, Guy Desaulniers

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Jørgen Glomvik Rakke, Henrik Andersson, Marielle Christiansen, Guy Desaulniers (2015) A New Formulation Based on Customer
Delivery Patterns for a Maritime Inventory Routing Problem. Transportation Science 49(2):384-401. https://doi.org/10.1287/
trsc.2013.0503

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Vol. 49, No. 2, May 2015, pp. 384–401
ISSN 0041-1655 (print) — ISSN 1526-5447 (online) http://dx.doi.org/10.1287/trsc.2013.0503
© 2015 INFORMS

A New Formulation Based on Customer Delivery

Patterns for a Maritime Inventory Routing Problem
Jørgen Glomvik Rakke, Henrik Andersson, Marielle Christiansen
Department of Industrial Economics and Technology Management,
Norwegian University of Science and Technology, 7491 Trondheim, Norway
{jorgen.rakke@ntnu.no, henrik.andersson@iot.ntnu.no, marielle.christiansen@iot.ntnu.no}

Guy Desaulniers
Department of Mathematics and Industrial Engineering, École Polytechnique and GERAD,
Montréal, Québec H3C 3A7, Canada, guy.desaulniers@gerad.ca

I n this paper we address a maritime inventory routing problem encountered by one of the world’s largest pro-
ducers of liquefied natural gas (LNG). The producer is responsible for the LNG inventories at the liquefaction
plant, the loading port with a limited number of berths, and the routing and scheduling of a heterogeneous fleet
of LNG ships. In addition, the producer has to fulfill a set of long-term contracts to customers all around the
world. The producer’s goal is to create a minimum-cost long-term delivery program that respects the long-term
contracts while maximizing revenue from selling LNG in the spot market. We introduce a new formulation for
this problem arising from a novel decomposition scheme based on delivery patterns. To solve this formulation,
we develop an exact branch-price-and-cut algorithm. Computational results show that this new formulation
provides much tighter lower bounds than the only known mixed integer programming (MIP) formulation for
this problem. Furthermore, on a set of 27 benchmark instances, the proposed branch-price-and-cut method
clearly outperforms a commercial MIP solver applied to the existing MIP model.
Keywords: maritime transportation; inventory routing; branch-price-and-cut; delivery patterns; valid
inequalities
History: Received: April 2012; revisions received: January 2013, July 2013; accepted: September 2013. Published
online in Articles in Advance April 28, 2014.

1. Introduction The MIRP addressed in this paper is the annual

Inventory routing problems (IRPs) (Dror and Ball
1987; Andersson et al. 2010) form a class of trans-
portation problems in which the producer must sup-
ply one or several products to a set of customers over
a multiperiod horizon, taking into account inventory
capacity at the producer or at the customers. To sup-
ply the customers, the producer must determine vehi-
cle routes for each period. In several IRPs such as
the one considered in this paper, the demand of each
customer for each product is expressed as a set of
targeted quantities to be delivered during various
intervals of time periods. To meet the target for a
time interval, several deliveries might be required.
The number of deliveries to a customer in an inter-
val and the quantity delivered in each delivery is
called a delivery pattern. In this paper, we propose a
formulation based on delivery patterns for a maritime
inventory problem (MIRP), as well as a branch-price-
and-cut algorithm for solving it. To our knowledge,
such a formulation is new in the IRP literature and
is also applicable to other IRPs where the customer
demands are expressed similarly.
384
delivery program (ADP) planning problem consid-
ered by Rakke et al. (2011). It arises at one of the
world’s largest producers and distributors of lique-
fied natural gas (LNG). The producer owns and oper-
ates a large liquefaction plant producing two types of
LNG. Connected to the liquefaction plant is a loading
port where the berth capacity restricts the number of
ships that can load simultaneously. The two different
types of LNG are loaded onto the ships from different
berths. From the loading port, the LNG is shipped to
customers worldwide in a hub-and-spoke network as
shown in Figure 1.
The producer has to fulfill a set of long-term cus-
tomer contracts. Each contract either outlines monthly
demands or states that a certain amount of LNG is
to be delivered fairly evenly spread throughout the
year to a given regasification terminal. Overdeliveries
and underdeliveries are accepted but incur a penalty.
The producer has no responsibility for the invento-
ries at the customers. In addition, the producer has
the opportunity to sell LNG in the spot market using
short-term contracts. The producer operates a large
heterogeneous fleet of LNG ships.
Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
Transportation Science 49(2), pp. 384–401, © 2015 INFORMS
C1
C4 Depot C3
C2
Figure 1 Illustration of the Sailing Patterns for the Ships
Note. C, Customer.
The same fleet of ships is used to transport the two
types of LNG, but each ship may only transport one
type on each voyage. To avoid sloshing, among other
factors, ships are always fully loaded when starting
a voyage. In peak periods it is possible to charter in
additional ships. To plan for the coming year, an ADP
is created. An ADP is a list of scheduled voyages, each
including information about the ship sailing, the day
of loading at the loading port, and the contract served.
The objective when creating an ADP is to abide the
long-term contractual agreements at the lowest pos-
sible cost while maximizing the revenue from spot
contracts.
The MIRP is a maritime adaptation of the well-
known IRP. Christiansen and Fagerholt (2009) give
an overview of MIRPs, whereas Christiansen et al.
(2007) present a comprehensive review within mar-
itime transportation in general.
The first studies on MIRPs were published by
Christiansen and Nygreen (1998a, b) and Christiansen
(1999). In these papers a supply chain for ammonia
consisting of several locations that either produce or
consume ammonia and the transportation network
between these locations is considered. Inventory con-
straints exist at both the production and consumption
locations, and the goal is to minimize the transporta-
tion cost. A branch-and-price method is used to solve
the overall problem in Christiansen (1999), whereas a
heuristic is used in Flatberg et al. (2000). Al-Khayyal
and Hwang (2007) present a mixed integer program-
ming (MIP) formulation for a multicommodity liq-
uid bulk MIRP. The problem analyzed is to find a
minimum-cost routing solution for a heterogeneous
fleet of ships engaged in the pickup and delivery
of several liquid bulk products while also deciding
the volumes of each product carried. Small instances
385
are solved to optimality, but because of the expo-
nential growth in computational time as the number
of port visits increases, the solution method seems
to be unsuitable for solving large problem instances.
Another multiproduct MIRP is described in Ronen
(2002). Here, the underlying model focuses on the
inventory management and not the routing part of
the problem, because the model solution suggests
shipment sizes that are assumed to be input for
a cargo-routing problem at a later stage. Recently,
Engineer et al. (2012) presented a branch-price-and-
cut algorithm for a MIRP based on transportation
of intermediate petrochemical products. In this prob-
lem, inventories were considered in both the load-
ing and unloading ports, and the ships could visit
more than one loading port before unloading in one
or more unloading ports. The algorithm was tested
on 45 instances of up to six ships, six loading ports,
four unloading ports, and a planning horizon of two
months. Approximately half of these are solved to
optimality.
Existing literature on LNG IRPs is scarce. The
first studies on optimization of LNG IRPs are by
Grønhaug and Christiansen (2009) and Grønhaug
et al. (2010). Compared with the problem considered
in this paper, the problem considered in Grønhaug
and Christiansen and Grønhaug et al. has a more
complex structure because it involves more than one
loading port and inventory constraints at both the
loading and delivery ports; each ship can visit more
than one delivery port on a given voyage. However,
the problem has fewer ships and ports, and it has a
shorter planning horizon than the problem presented
in this paper. Grønhaug and Christiansen give both
an arc-flow and a path-flow formulation of the prob-
lem. The paths are pregenerated in Grønhaug and
Christiansen, whereas Grønhaug et al. use a branch-
price-and-cut algorithm to solve the problem.
The most general study of the LNG supply chain,
including some of its main characteristics, is presented
in Andersson, Christiansen, and Fagerholt (2010). The
authors analyze two problems, one for a producer
of LNG and one for a vertically integrated company.
A mathematical model is presented for each problem
and solution methods for both models are discussed,
but no computational results are given. The main dif-
ferences between the problems studied by Andersson,
Christiansen, and Fagerholt and the problem studied
in this paper are that we consider more than one LNG
product and take into account the possibility of sell-
ing LNG in the spot market. For the vertically inte-
grated company, Andersson, Christiansen, and Fager-
holt study inventory management at the regasification
terminals, which is not considered in this paper.
The ADP planning problem considered in this
paper is also studied in Rakke et al. (2011) and
 Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
386
Stålhane et al. (2012). Rakke et al. present a rolling
horizon heuristic that solves the problem by sequen-
tially solving MIPs defined on shorter overlapping
subhorizons of the planning horizon. In Stålhane
et al. a construction and improvement heuristic is
presented. It constructs a feasible ADP by iterating
over the days in the planning horizon and creates
scheduled voyages based on the availability of ships
and gas while keeping inventory feasible. Both Rakke
et al. and Stålhane et al. use a reduced MIP to improve
the ADP computed by the first heuristic. Halvorsen-
Weare and Fagerholt (2013) study a simplified version
of the problem where cargoes for each long-term con-
tract are pregenerated with defined time windows,
and the fleet of ships can be divided into disjoint
groups. The problem is decomposed into a routing
subproblem and a scheduling master problem where
berth, inventory, and scheduling decisions are han-
dled in the master problem, whereas routing decisions
are dealt with in the subproblem. Unlike branch and
price, the subproblems are solved only once.
The purpose of this paper is to present a new for-
mulation for a MIRP that arises from a novel decom-
position scheme. In most papers on inventory routing
and scheduling, the decomposition involves creating
one subproblem for each ship/vehicle. Each corre-
sponds to a resource-constrained shortest-path prob-
lem (see Desaulniers et al. 1998) and allows the gen-
eration of paths for the associated ship/vehicle. This
is not always possible because of the complexity of
the subproblems. As discussed in §3.2, a path-flow
formulation may not be the best choice to strengthen
the formulation compared with the arc-flow formu-
lation. Our new formulation, which is based on cus-
tomer delivery patterns, represents an alternative to
the traditional path-flow formulation and may be
more appropriate for certain routing and scheduling
problems where the demand of a customer is given
as targeted quantities to be delivered during time
intervals, and several deliveries may be required to
meet a target. The reason for this is that it strength-
ens the linear relaxation and provides much better
lower bounds. For our problem, we develop an exact
branch-price-and-cut algorithm to solve the new for-
mulation based on delivery patterns. This algorithm
involves three families of cuts, where one is new,
one is adapted from another MIRP and strength-
ened, and one is directly adapted from another MIRP.
Our computational experiments show that this new
formulation produces better lower bounds than the
formulation used by Rakke et al. (2011) and Stålhane
et al. (2012). Furthermore, on a set of 27 benchmark
instances, the branch-price-and-cut algorithm turns
out to be more effective for computing optimal and
near-optimal solutions than a direct MIP approach
Transportation Science 49(2), pp. 384–401, © 2015 INFORMS
based on the formulation of Rakke et al. (2011) and
Stålhane et al. (2012).
The remainder of this paper is organized as follows.
The MIRP addressed in this paper is stated in §2. Two
mathematical formulations, that of Rakke et al. (2011)
and Stålhane et al. (2012) and the one based on deliv-
ery patterns, are presented in §3, together with some
valid inequalities. The branch-price-and-cut method
is described in detail in §4. Computational results are
then reported in §5 before giving some concluding
remarks in §6.
2. Problem Definition and Notation
The ADP planning problem is defined on a planning
horizon T that is partitioned into days numbered
from 1 to T ; that is, T = 811 0 0 0 1 T 9. It may involve sev-
eral types of LNG (two for our tests). Each type g ∈ G
must be distributed from a single loading port that
has Bg berths available for that type of LNG. This port
is connected to a liquefaction plant where the natural
gas is liquefied before transport. At this plant, the pro-
duction rate of gas type g may vary from day to day
and is equal to Pgt on day t ∈ T. The LNG is stored
in storage tanks that have time-dependent upper and
lower limits Qgt and Qgt , respectively. Variations in
the production rate and inventory limits in tactical
planning are mainly as a result of planned mainte-
nance. The inventory levels must always be within
these limits. In those tanks, there may be an initial
inventory, and there may be LNG left at the end of
the planning horizon. This end inventory is rewarded
RIg per unit of gas.
The producer has no responsibilities for the inven-
tories at the customers. There are several reasons for
this, but the most important ones are that this is not
stipulated in the long-term contracts and that several
producers may deliver LNG to the same customer.
The produced LNG is delivered to customers by
ships. All deliveries are made to a given contract
c ∈ C, a generic term to represent every possible des-
tination. The contract set C can be partitioned into
disjoint subsets Cg containing only the contracts with
demand for gas type g. Furthermore, C can also
be partitioned into three disjoint subsets, CLT , CS ,
and CM . Subset CLT contains the long-term contracts.
A contract c ∈ CLT specifies a regasification terminal
and the type of LNG demanded. Subset CS contains
the spot contracts that model the possibility to sell
excess LNG in the spot market. There is one contract
c ∈ CS for each type of LNG. RSc denotes the revenue
per unit of LNG delivered to spot contract c. Because
the spot market is not modeled in detail, we assume
that the LNG sold in the spot market is delivered
to the regasification terminal farthest away from the
loading port. The spot contracts have infinite demand,
Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
Transportation Science 49(2), pp. 384–401, © 2015 INFORMS 387

but there are no obligations to fulfill them. Finally,
CM is the subset of artificial maintenance contracts,
one contract for each type of LNG. These contracts are
used to simplify the notation and do not correspond
to gas deliveries. They are associated with gas types
to indicate which berths are occupied by the ships
after maintenance (see next).
Typically, long-term contracts stipulate a monthly
demand or that the LNG should be delivered fairly
evenly throughout the planning horizon. Demands
are thus defined on time intervals (e.g., months, quar-
ters, years) that correspond to subsets of consecutive
days. A time interval, indexed by i, is denoted by
TIi = 8 Ti 1 Ti + 11 0 0 0 1 T i 9, where Ti and T i are its initial
and final days, respectively. The set of time intervals
applicable to contract c ∈ CLT is denoted Ic and cov-
ers T. The demand in interval i ∈ Ic is Dci . It must
not be met exactly, but there are artificial penalty costs
CciD+ and CciD− associated with over- and underdeliv-
ery, respectively. These costs are set according to the
length of Ti in such a way that shorter intervals have
a smaller penalty cost. Consequently, the demands
can be seen as targets, and overlapping intervals can
be considered for the same contract.
A heterogeneous fleet of ships V is used to deliver
the LNG. Ship v ∈ V has a loading capacity Lv ,
requires Tcv days to make a delivery to contract c ∈ C,
T in time interval i ∈ Ic are represented by nonnegative
and incurs a sailing cost of Ccv to make this deliv-
ery. Because of a previous assignment, it may not be
available at the beginning of the horizon. We denote
by Tv = 8 Tv 1 Tv + 11 0 0 0 1 T 9 ⊆ T its set of available
days, where Tv is its first available day. For various
reasons, a ship may not be allowed to service certain
contracts. The set of ships that can service contract
c ∈ C is denoted Vc .
The fleet of ships can be separated into two disjoint
subsets: the set of ships VP operated by the producer
and the set of spot ships VS available for in-charter.
It is assumed that at most —G— ships can be chartered in
each day, one for each type of LNG. This is modeled
by considering —G— ships in VS , each only able to load
one type of LNG, and by setting Tcv = 1 for all c ∈ C
the berth capacity and ship maintenance constraints.
A voyage serves a given contract (possibly a mainte-
nance) using a specific ship starting from the loading
port on a given day. We assume that all deliveries are
full shiploads and that a voyage contributes to satisfy
the demand for the time interval in which it starts.
3. Mathematical Formulations
In this section, two mathematical formulations for the
ADP planning problem are presented. In §3.1 a basic
formulation similar to the one in Rakke et al. (2011)
and Stålhane et al. (2012), referred to as the basic voy-
age formulation (BVF), is provided. In §3.2 a new for-
mulation derived from the BVF is introduced. This
formulation relies on delivery patterns, which for a
given contract specify the number of deliveries by
each ship in a given time interval. It is called the
pattern-based formulation (PBF).
3.1. The Basic Voyage Formulation
In the BVF, we use the following variables: A binary
variable xcvt is associated with each feasible scheduled
voyage defined by ship v ∈ V, contract c ∈ C, and
start day t ∈ T such that v ∈ Vc and t ∈ Tv (or TM v if
v ∈ VM ). These variables are equal to 1 if the sched-
uled voyage is selected in the solution and 0 other-
wise. Over- and underdelivery to a contract c ∈ CLT
variables yci+ and yci− , respectively. The inventory level
of gas type g ∈ G at the end of day t ∈ T is given by
the nonnegative variable qgt .
Using this notation, the ADP planning problem can
be formulated as the following MIP, hereafter referred
to as the BVF:

XX X T
min Ccv xcvt
c∈C v∈Vc t∈Tv
CciD+ yci+ + CciD− yci−
X X X X
+
c∈CLT i∈Ic c∈CLT i∈Ic

RSc Lv xcvt − RIg qgT
X X X X
− 1 (1)
c∈CS v∈Vc t∈Tv g∈G

and v ∈ VS . subject to
All ships must be scheduled for maintenance once X X X X
every three to five years. Thus, some ships, those in xcvt + xcv4t−Tcv +15 ≤ Bg
subset VM ⊂ VP , are predetermined to go through c∈Cg \CM v∈Vc c∈Cg ∩CM v∈VM
2 4t−Tcv +15∈Tv
maintenance once during the planning horizon. We
denote by TM ∀ g ∈ G1 t ∈ T1 (2)
v ⊆ Tv the set of days when a ship
v ∈ VM can start maintenance. After maintenance, a
X X
qg1 t−1 +Pgt −qgt − Lv xcvt = 0
ship has to go through a purge and cooldown proce- c∈Cg \CM v∈Vc
dure at any berth in the loading port. This procedure
takes approximately one day. ∀ g ∈ G1 t ∈ T1 (3)
The ADP planning problem consists of determining Qgt ≤ qgt ≤ Qgt ∀ g ∈ G1 t ∈ T1 (4)
voyages so as to minimize total costs (for sailings, over- X X
and underdeliveries) minus total revenues (from spot xcv’ ≤ 1 ∀ v ∈ V1 t ∈ Tv 1 (5)
c∈C ’∈Tv
deliveries and LNG end inventory) while satisfying 24t−Tcv 5<’≤t
 Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
388
∀ v ∈ VM 1
X X
xcvt = 1
c∈CM t∈TM
v a delivery pattern, indexed by p, stipulates the num-
X X
Lv xcvt +yci− −yci+ = Dci
v∈Vc t∈TI ∩Tv
i
∀ c ∈ CLT 1 i ∈ Ic 1
xcvt ∈ 80119 ∀ c ∈ C1 v ∈ Vc 1 t ∈ Tv 1
LT
yci+ 1yci− ≥ 0 ∀ c ∈ C 1 i ∈ Ic 0
The objective function (1) minimizes the sum of the
transportation and penalty costs minus the revenue
from LNG sold in the spot market and the LNG left
in the tanks at the liquefaction plant at the end of the
planning horizon. The berth restrictions are imposed
by constraints (2). Because a ship goes through a
one-day purge and cooldown procedure at one of
the berths after maintenance, the maintenance vari-
ables are added to the constraints associated with the
day of the return from maintenance. Constraints (3)
take all inflows and outflows into account to balance
the inventory of all LNG types at the loading port.
Constraints (4) ensure that the inventory levels are
always between their upper and lower limits. The
availability constraints (5) specify that a ship is only
allowed to operate at most one scheduled voyage
each day. Maintenance requirements are handled by
constraints (6). Constraints (7) ensure that the contrac-
tual demands are met, or that the appropriate penalty
is added for not doing so. Constraints (8) and (9) are
the variable restrictions.
Model (1)–(9) is a MIP that can be solved using a
commercial MIP solver. Computational results with
such a solution method are reported in §5.
3.2. Pattern-Based Formulation
When reformulating transportation problems, the arc-
flow variables are usually replaced by path-flow vari-
ables. If the extreme points of the subproblem for
generating these paths are not necessarily integer, the
path-flow formulation has the potential to improve
the lower bound of the relaxation (see Geoffrion 1974).
For the problem described in this paper, and many
other shipping problems that can be defined on a
time-space network, the path-flow formulation would
not strengthen the lower bound of the relaxation
because the extreme points of the subproblems would
be integer. Hence, to strengthen the lower bound of
the relaxation, another reformulation is needed.
One problem with the BVF is that its linear pro-
gramming (LP) relaxation is weak, mainly because it
is always possible to deliver fractional combinations
of shiploads to avoid penalties. We know that this
is not possible in a feasible solution to the MIP, and
hence it introduces a large gap between the LP and
MIP optimal values. To reduce this gap, the BVF is
reformulated using delivery patterns.
Transportation Science 49(2), pp. 384–401, © 2015 INFORMS
For a contract c ∈ CLT and a time interval i ∈ Ic ,
(6)
ber of deliveries Ncipv that each ship v ∈ Vc performs
to contract c in time interval i (delivery days are not
given). Let Pci be the set of all feasible delivery pat-
(7) terns for contract c and interval i. Because a pattern
p ∈ Pci specifies the total quantity delivered to con-
(8)
tract c in interval i, the over- or underdelivery penalty
(9) for c in i is known if this pattern is selected in the
P
solution. This penalty is denoted Ccip . Using delivery
patterns forces the LP optimal value to also incorpo-
rate some of the penalty costs, reducing the gap to the
MIP optimal value.
Figure 2 shows the effect of considering deliv-
ery patterns in a small example with one contract,
one time interval, and two ships denoted v1 and v2 .
These ships have capacities of 20 and 30, respectively,
whereas the contract demand in the time interval
is 36. The penalty for over- and underdelivery is 15.
Clearly, we cannot meet the demand exactly with full
shiploads. In Figure 2 the points on the dashed line
represent delivery patterns. With integer numbers of
deliveries, the closest quantities that can be delivered
are 30 and 40, resulting from a pattern with one deliv-
ery made by v2 and a pattern with two deliveries
by v1 , respectively. These correspond to an under-
delivery of 6 and an overdelivery of 4, giving pattern
penalties of 90 and 60, respectively. In the BVF the LP
solution proposes to deliver fractional loads, yielding
a perfect delivery and no penalty. Because all delivery
patterns have a nonzero penalty in this case, an LP
solution obtained as a linear combination of patterns
incurs a positive penalty.
The delivery patterns may resemble cutting pat-
terns in the cutting stock problem, but where the cut-
ting patterns have a hard upper limit on the total
length, the delivery patterns have no upper bound on
the amount delivered. For maritime transportation a
similar idea is presented in Christiansen (1999), where
BVF
PBF
400
Penalty
200
0
0 10 20 30 40 50
Delivered quantity
Figure 2 Illustration of the Penalty as a Function of Delivered Amount
Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
Transportation Science 49(2), pp. 384–401, © 2015 INFORMS 389

harbor visit sequences for a given port stipulating The resulting valid inequalities presented in §3.3.1 are
delivered quantities and visiting times are considered. strengthened compared with the ones presented by
However, the visiting times and delivered quantities Engineer et al. (2012), although to our knowledge, the
are not linked to specific ships, only to the inventory type of valid inequalities described in §3.3.2 is new.
and production/consumption. Finally, for the timing cuts, we utilize that a sufficient
Besides the variables used in the BVF, the PBF in- amount of LNG needs to be in the inventories before
volves a continuous variable zcip for each contract c ∈ a ship can be fully loaded. These cuts are described
CLT , time interval i ∈ Ic , and delivery pattern p ∈ Pci . in §3.3.3 and are adapted from the timing cuts given
Such a variable is restricted to take a value in 601 17. by Engineer et al. (2012).
Binary restrictions on these variable are not required 3.3.1. Minimium Number of Loadings. For a
because convex combinations of different patterns for given gas type g, the minimum number of load-
the same contract and time interval can yield feasi- ings to perform during a time interval T 0 = 8i1 0 0 0 1 j9
ble integer solutions. Binary requirements on the xcvt depends on the incoming inventory qg1 i−1 , the outgo-
variables that are linked to the zcip variables ensure ing inventory qgj , and the production in the interval
the overall integrality of the solution. 0
Pgij
P
= t∈8i10001j9 Pgt . A lower bound on the number of
Using this notation, the PBF is given by loadings in T 0 is given by

 0
Pgij + qg1 i−1 − Qgj
XX X T X X X P 
min Ccv xcvt + Ccip zcip
0 (15)
c∈C v∈Vc t∈Tv c∈CLT i∈Ic p∈Pci Lmax

0
−
X X X
RSc Lv xcvt −
X
RIg qgT 1 (10) The quantity Pgij + qg1 i−1 − Qgj is the gas in excess of
c∈CS v∈Vc t∈Tv g∈G storage capacity that needs to be shipped during T 0 ,
and Lmax is the loading capacity of the largest vessel.
subject to When i = 1, qg1 i−1 (i.e., qg0 ) is constant, and the
constraints (2)–(6)1 resulting cut
 0
Pg1j + qg0 − Qgj
X X 
xcvt − Ncipv zcip = 0 X X X
t∈Tv ∩TIi p∈Pci
xcvt ≥ (16)
c∈Cg v∈Vc t∈T 0 ∩Tv
Lmax
∀ c ∈ CLT 1 i ∈ Ic 1 v ∈ Vc 1 (11)
X LT is the same as the one presented in Engineer et al.
zcip = 1 ∀ c ∈ C 1 i ∈ Ic 1 (12)
(2012). For a heterogeneous fleet, the bound in (16)
p∈Pci
can be strengthened by using the fact that a ship will
xcvt ∈ 80119 ∀ c ∈ C1 v ∈ Vc 1 t ∈ Tv 1 (13) be unavailable for a new voyage until the previous
zcip ≥ 0 LT
∀ c ∈ C 1 i ∈ Ic 1 p ∈ Pci 0 (14) one is completed. For instance, consider a problem
with three ships, v1 , v2 , and v3 , and one gas type g.
The objective function (10) is equivalent to (1). The ships have capacities of Lv1 = 150, Lv2 = 125, and
Notice that the second term has changed from explic- Lv3 = 100, respectively. There is a constant production
itly using the penalties of the over- and underdeliv- of Pgt = 50 on each day t ∈ T 0 , qg0 = 300 in incom-
eries to using the penalty costs calculated from the ing inventory, and a maximum storage capacity of
patterns. Constraints (2)–(6) are the same as in the Qgj = 400 on the last day j. The minimum sailing time
BVF. Constraints (7) are handled implicitly through to any contract by any ship is 10 days. After —T 0 — = 8
the patterns. Instead, we add constraints (11) that link days, the amount of gas in excess of storage capacity
the pattern variables to the scheduled voyage vari- is 300. Using (15) yields a lower bound of two load-
ables, and the convexity constraints (12) that ensure ings. Observing that ship v1 with capacity 150 cannot
the assignment of a single pattern (possibly a convex load more than once in T 0 , at least three loadings are
combination of several patterns) to each long-term required.
contract and time interval. The strengthened lower bound can be computed
Model (10), (2)–(6), and (11)–(14) is a MIP that may by solving the following knapsack problem with side
contain a large number of pattern variables. To solve constraints:
it, we develop a branch-price-and-cut method in §4. X
lg 411j5 = min nv 1 (17)
v∈V
3.3. Valid Inequalities
In this section we present families of valid inequal- subject to
ities that are used to strengthen the LP relaxation X 0
Lv nv ≥ Pg1j +qg0 −Qgj 1 (18)
of the PBF. The first two families of valid inequal- v∈V
ities are based on a calculated minimum and max- X X
xcv’ ≤ 1 ∀ v ∈ V1 t ∈ T 0 ∩Tv 1 (19)
imum number of loadings in the liquefaction plant
c∈Cg \CM ’∈T 0 ∩Tv
and are presented in §§3.3.1 and 3.3.2, respectively. v∈Vc 4t−Tcv 5<’≤t
 Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
390 Transportation Science 49(2), pp. 384–401, © 2015 INFORMS

X X
xcvt = nv ∀ v ∈ V1 (20) relaxation can be strengthened by a linear interpola-
c∈Cg \CM t∈T 0 ∩Tv tion between œgij − 1 and œgij . The resulting inequali-
v∈Vc ties are
xcvt ∈ 80119 ∀ c ∈ Cg \CM 1 v ∈ Vc 1 t ∈ T 0 ∩Tv 1 (21) X X X qg1 i−1 − Qg1 i−1
xcvt ≥ 0 0
+ œgij
where nv is the number of loadings performed by c∈Cg v∈Vc t∈T 0 ∩Tv Pgij + Qg1 i−1 − Qgj − Pgij
ship v in T 0 and lg 411 j5 is the lower bound on the total
∀ g ∈ G1 i1 j ∈ T1 i < j0 (26)
number of loadings that have to be performed in T 0 .
The objective function (17) minimizes the number of 3.3.2. Maximum Number of Loadings. For any
loadings performed in T 0 , and constraint (18) ensures given time interval T 0 = 8i1 0 0 0 1 j9, only a limited num-
that the amount of excess gas is loaded onto the ships. ber of loadings of gas type g is possible given the
Constraints (19) handle the routing restrictions of the incoming inventory qg1 i−1 , P
the outgoing inventory qgj ,
ships, and constraints (20) link the nv variables to the and the production Pgij 0
= t∈T 0 Pgt in interval T 0 . An
xcvt variables. Constraints (21) are the variable restric- upper bound on the number of loadings in T 0 is
tions. Consequently, for i = 1, the “minimum number given by
of loadings” inequalities are  0
Pgij + qg1 i−1 − qgj

1 (27)
X X X
xcvt ≥ lg 411 j5 ∀ g ∈ G1 j ∈ T0 (22) Lmin
c∈Cg \CM v∈Vc t∈T 0 ∩Tv where Lmin is the capacity of the smallest ship.
Because both qg1 i−1 and qgj are variables, this bound
Note that if lg 411 j5 = lg 411 j 0 5 for j 0 > j, then the is clearly nonlinear. In this paper we have chosen to
inequality for j dominates the one for j 0 , which can focus on the maximum number of loadings with only
thus be omitted. the incoming inventory as a variable because the most
For all i > 1, qg1 i−1 is variable, and (15) leads to a common reason for fractionality is due to a partial
nonlinear bound on the number of loadings. How- loading of ships as a result of a lack of inventory. This
ever, by bounding qg1 i−1 , two different valid inequali- means that the fractional solution loads all incom-
ties can be derived. First, the smallest value that qg1 i−1 ing inventory and LNG produced, and there is no
can take is Qg1 i−1 . Hence, the inequalities outgoing inventory above the lower limits on inven-
0
tory Qgj . Therefore, for the rest of this section, we
Pgij + Qg1 i−1 − Qgj
 
X X X
xcvt ≥ assume that qgj = Qgj . If this assumption does not
c∈Cg \CM v∈Vc t∈T 0 ∩Tv
Lmax hold, the proposed inequalities are valid but weaker.
Under this assumption, the upper bound (27) now
∀ g ∈ G1 T 0 ∈ T (23) becomes  0
Pgij + qg1 i−1 − Qgj

are valid for the PBF. For a heterogeneous fleet, this 0 (28)
Lmin
bound can be improved in the same way as we
When i = 1, qg1 i−1 (i.e., qg0 ) is known, and the bound
strengthened the bound for i = 1.
(28) is constant. The resulting inequality
The second set of inequalities is derived by bound-
ing qg1 i−1 from above. If qg1 i−1 = Qg1 i−1 , the amount X X X
 0
Pgij + qg1 0 − Qgj

of gas in excess of the maximum storage capacity is xcvt ≤ (29)
0 c∈Cg v∈Vc t∈T 0 ∩Tv
Lmin
Pgij + Qg1 i−1 − Qgj . This makes it necessary to ship
0 is thus valid for the PBF. As for the “minimum num-
Pgij + Qg1 i−1 − Qgj
 
œgij = (24) ber of loadings” inequalities, the upper bound in (29)
Lmax can also be strengthened by solving the following
knapsack problem with side constraints:
shiploads. Given full shiploads and a full outgoing
0
inventory, it might not be possible to transport Pgij +
X
ug 411 j5 = max nv (30)
0
Qg1 i−1 − Qgj in a given time interval T . The maximal v∈V
amount of gas that may be shipped is
subject to
0
Pgij + Qg1 i−1 − Qgj max
  X 0
0
Pgij = L 0 (25) Lv nv ≤ Pg1j + qg0 − Qgj 1
Lmax v∈V

0 0
constraints (19)–(21). (31)
Given that Pgij < Pgij + Qg1 i−1 − Qgj , the boundary
of the feasible region is piecewise linear for mgij ∈ In this case, the objective (30) aims at finding the max-
6œgij − 11 œgij 7, where mgij denotes the number of load- imum number of loadings that can be performed to
ings of gas type g in T 0 . Since qg1 i−1 ≤ Qg1 i−1 , the linear load a maximum amount of gas (31).
Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
Transportation Science 49(2), pp. 384–401, © 2015 INFORMS 391

Using such upper bounds for i = 1, the “maxi- t1 t2 t3 t4 Sum loading day indices
mum number of loadings” inequalities for the PBF are
1 1 1
given by xcvt 0 3 3 3
2 × 13 + 3 × 13 + 4 × 13 = 3
Loaded 0 33 13 33 31 33 13 100
X X X
xcvt ≤ ug 411j5 ∀ j ∈ T1 g ∈ G0 (32) Inventory 30 26 2
3
23 1
3
20
c∈Cg \CM v∈Vc t∈T 0 ∩Tv
Figure 3 Example 1: A Fractional Solution Where Loading Starts
The valid inequalities for j 0 < j can be omitted when- Without Waiting for Sufficient Inventory to Fill a Full
ever ug 411 j5 = ug 411 j 0 5 because the inequality for j Shipload
will dominate that of j 0 .
The total amount loaded, lg 4t1 1 t4 5, in this interval is
For a heterogeneous fleet with a substantial differ-
100. Given the initial inventory, it takes
ence in capacity among the ships, inequalities (32) are
often not binding. This is due to economies of scale. lg 4t1 1 t4 5 − qg1 t1 −1 100 − 0 1
= =3
Hence, the minimization drives the solution to use the Pg 30 3
largest ships more than the smaller ones. In inequali-
days to build up sufficient inventory for one full
ties (32), the bound is based on using the smaller ships shipload. That means no loading can occur before
as much as possible, and this results in a weak bound day t4 . The weighted sum of all loading day indices,
when large capacitated ships are used. To strengthen where the weights are the values of the corresponding
the bound also for the larger ships, the bound may be voyage variables, is 3, which is clearly invalid.
calculated for a subset of ships with a capacity greater Consider another example with one gas type g and
than a given lower limit. Let K be the set of all ship three ships v1 , v2 , and v3 of capacities 150, 125, and
capacities and denote by V0k the subset of ships hav- 100, respectively. Given a constant production of Pg =
ing a capacity greater than or equal to k ∈ K. Inequal- 50 each day, the amount of LNG produced in an inter-
ities (32) can be generalized: val 6t1 1 t7 7 of 7 days t1 1 t2 1 0 0 0 1 t7 is 350. Assume a zero
incoming inventory and a single contract c. Hence,
xcvt ≤ ukg 411 j5
X X X
each ship has seven x-variables associated with voy-
c∈Cg \CM v∈V0k ∩Vc t∈T 0 ∩Tv ages to c. A fractional solution for this example is
∀ j ∈ T1 k ∈ K1 g ∈ G1 (33) given in Figure 4. Here, lg 4t1 1 t7 5 is 350. Since the
largest ship has a capacity of Lmax = 150, multiple
where ukg 411 j5 is the optimal value of the knapsack loadings are needed to lift lg 4t1 1 t7 5 = 350; that is, at
problem (30), (31), and (19)–(21) solved for V0k and least ‘lg 4t1 1 t7 5/Lmax ’ = ‘350/150’ = 3 loadings. Given
V0k ∩ Vc instead of V and Vc , respectively. Again, if the production rate of Pg = 50 per day, at least one of
ukg 411 j5 = ukg 411 j 0 5 and j 0 < j, then the inequality for them must be performed on day t7 or later. Underes-
j dominates that for j 0 , which does not need to be timates on the indices of the days on which the first
considered. As far as we know, the valid inequalities and second loadings can be derived as
(33) are new to the literature. lg 4t1 1 t7 5 − qg0t1 −1 − 2Lmax 50
For i > 1, valid inequalities similar to inequalities = =1
Pg 50
(26) can be derived by bounding qg1 i−1 .
and
lg 4t1 1 t7 5 − qg0t1 −1 − Lmax 200
3.3.3. Timing Cuts. In fractional solutions one = = 41
Pg 50
often sees time intervals with consecutive fractional-
valued voyage variables caused by starting voyages respectively. This gives a lower bound of 12 for the
before enough LNG is available to fill a full shipload. weighted sum of the loading day indices, which is
A family of cuts, called the timing cuts, was proposed violated by the fractional solution given in Figure 4.
by Engineer et al. (2012) for reducing such fraction- In the following, a more formal definition of these
ality in an IRP from the petroleum business. A tim- inequalities is given. Let
X X X
ing cut considers the weighted sum of loading days lg 4ti 1 tj 5 = Lv xcvt
in perspective of the production rate and incoming c∈Cg \CM v∈Vc t∈Tij0 ∩Tv
inventory to eliminate certain fractional solutions.
be the total amount of gas type g loaded in a time
For example, consider an instance of the ADP with max
interval Tij0 = 8ti 1 0 0 0 1 tj 9, and let Pgij be an overesti-
one contract c, one ship of capacity 100, and an inter- mation of the (daily) production rate in Tij0 . This over-
val 6t1 1 t4 7 containing four days t1 , t2 , t3 , and t4 . For a estimation can be computed as
gas type g ∈ G, there is a constant production, Pg , of 30  Pt
t 0 =ti Pgt 0

per day, and the initial inventory, qg1 t1 −1 , is 0. A frac- max
Pgij = max 0
tional solution for this instance is given in Figure 3. t∈Tij0 t − ti + 1
 Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
392 Transportation Science 49(2), pp. 384–401, © 2015 INFORMS

t1 t2 t3 t4 t5 t6 t7 Sum loading day indices

is valid for the PBF. Note that it may be violated
by a fractional solution only when 4Kgij − 15Lmax <
v1 1
3
1
3
0 1
3
0 0 0 1 × 13 + 2 × 13 + 4 × 13 = 2 13 lg 4ti 1 tj 5 − qg1 ti −1 ≤ Kgij Lmax . The family of timing
v2 0 0 0 0 0 1
5
3
5
6 × 15 + 7 × 35 = 5 25 inequalities is defined by (36) for all g ∈ G and ti 1 tj ∈
v3 0 0 1
2
0 1
2
0 0 3 × 12 + 5 × 12 = 4 T such that ti < tj .
11
Loaded 50 50 50 50 50 25 75 350 11 15
Inventory 0 0 0 0 0 25 0 4. Solution Method for the PBF
We propose to solve the PBF using a branch-price-
Figure 4 Example 2: A Fractional Solution Where Loading Starts and-cut algorithm (see, e.g., Barnhart et al. 1998;
Without Waiting for Sufficient Inventory to Fill a Full
Shipload
Lübbecke and Desrosiers 2005), that is, a branch-and-
bound (B&B) algorithm in which the lower bounds
Given the loaded amount lg 4ti 1 tj 5 and the incoming are computed by column generation and tightened
inventory qg1 ti −1 , the amount of LNG that needs to be using the valid inequalities described in §3.3. Because
produced is lg 4ti 1 tj 5−qg1 ti −1 . Its production requires at of the very large number of delivery patterns that
max
least tgij = ‘4lg 4ti 1 tj 5 − qg1 ti −1 5/Pgij ’ days. Hence, the exists in practice, column generation is applied at
last loading can start at the earliest on day ti − 1 + tgij . each node of the enumeration tree for solving the cor-
The minimum number of loadings needed to lift an responding LP relaxation, which is called the master
amount of lg 4ti 1 tj 5 is Kgij = ‘l4ti 1 tj 5/Lmax ’. Therefore, problem. This method is iterative and starts by con-
after performing loading number k, at least Kgij − k sidering the master problem restricted to a small sub-
additional loadings are needed to lift lg 4ti 1 tj 5. This set of the delivery pattern variables (columns). This
means that after this loading, the amount of gas left to restricted master problem (RMP) is solved using the
produce is at most 4Kgij − k5Lmax . Consequently, load-
primal simplex method to yield a primal and a dual
ing k can be performed at the earliest on day
solution. To determine whether the primal solution is
lg 4ti 1 tj 5 − qg1 ti −1 − 4Kgij − k5Lmax
 
k also optimal for the complete master problem (setting
tgij = ti − 1 + 0 (34)
max
Pgij to zero all variables that were not considered), aux-
iliary problems, called the subproblems or the pricing
This gives the constraint problems, are solved. These subproblems depend on
k
X X X X
txcvt ≥ tgij 1 the RMP dual solution and aim at finding negative
c∈Cg \C M v∈Vc t∈Tij0 ∩Tv k∈8110001Kgij 9 reduced-cost pattern variables. When such columns
are found, they are added to the current RMP before
which is equivalent to
starting a new iteration. When the subproblems prove
k
X X X X
4t − ti + 15xcvt ≥ 4 tgij − ti + 150 that no such columns exist, column generation stops,
c∈Cg \C M v∈Vc t∈Tij0 ∩Tv k∈8110001Kgij 9 and the optimal value of the current RMP provides a
By substitution with (34), we get the following valid lower bound for the current B&B node.
inequality: The pricing problems, the handling of the valid
X X X inequalities, and the branching strategies used to
4t −ti +15xcvt derive integer solutions are described in the following
c∈Cg \C M v∈Vc t∈Tij0 ∩Tv
sections.
lg 4ti 1tj 5−qg1ti −1 −4Kgij −k5Lmax
 
X
≥ max
0 (35) 4.1. Pricing of Columns
k∈8110001Kgij 9
Pgij In typical column generation methods for trans-
This inequality is, however, nonlinear. But because portation problems (Desaulniers et al. 1998), the
‘a’ ≥ a for all a ∈ , the inequality subproblems are resource-constrained shortest-path
X X X problems (Irnich and Desaulniers 2005) where a path
4t −ti +15xcvt corresponds to the route of a vehicle. For the PBF,
c∈Cg \C M v∈Vc t∈Tij0 ∩Tv
the subproblems are of a different nature because the
X lg 4ti 1tj 5−qg1ti −1 −4Kgij −k5Lmax formulation involves delivery pattern variables rather
≥ max than path variables.
k∈8110001Kgij 9
Pgij
In the proposed column generation method for PBF,
X lg 4ti 1tj 5−qg1ti −1 −Kgij Lmax X kLmax there is one subproblem for each contract c ∈ CLT
= max
+ and time interval i ∈ Ic , which corresponds to a
k∈8110001Kgij 9
Pgij k∈8110001Kgij
P max
9 gij bounded knapsack problem with a soft capacity (i.e.,
Kgij 4lg 4ti 1tj 5−qg1ti −1 −Kgij Lmax 5 Kgij 4Kgij +15Lmax the capacity can be extended in return of a penalty).
= max
+ max Let ci and ‚civ , for c ∈ CLT , i ∈ Ic , v ∈ Vc , be the
Pgij 2Pgij
dual variables of constraints (12) and (11), respec-
(36) tively. The reduced cost of the zcip variable associated
Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
Transportation Science 49(2), pp. 384–401, © 2015 INFORMS 393

with contract c, time interval i, and delivery pattern Let V̄c ⊆ Vc be the subset of ships v such that ‚v <
p is given by −C D+ Lv , and define D̃ = D − v∈Vc Lv lv − v∈V̄c Lv ·
P P
4uv − lv 5. Let V− c ⊆ Vc be the subset of ships v such
P
X
C̄cip = Ccip − ci + Ncipv ‚civ 0 (37) that −C D+ Lv < ‚v < C D− Lv , and let u0v = uv − lv . The
v∈Vc
subproblem can then be written as
At a given column generation iteration, the goal of  
D+ D− + D−
X
the subproblem for contract c and time interval i is to min K +4C +C 5y + 4‚v −C Lv 5nv (48)
find a pattern p ∈ Pci of minimum reduced cost C̄cip . v∈V−
c

Dropping the indices c and i (except for Vc ) and let- s.t.

X
Lv nv ≤ D̃ +y + 1 (49)
ting nv be an integer variable representing the number v∈V−
c
of voyages made by ship v, this subproblem can be
0 ≤ nv ≤ u0v 1nv is integer ∀ v ∈ V−
c 1 (50)
formulated as follows:
  y + ≥ 01 (51)
min C D+ y + + C D− y − −  +
X
‚v nv (38)
where K = C D− D −  + v∈Vc 4‚v − C D− Lv 5lv +
P
v∈Vc
D− 0
P
v∈V̄c 4‚v − C Lv 5uv is a constant.
X
s.t. Lv nv + y − − y + = D1 (39)
v∈Vc
Two trivial cases can be discarded. First, if D̃ < 0,
then nv = 0, v ∈ V− c provides an optimal solution.
lv ≤ nv ≤ uv 1 nv is integer ∀ v ∈ Vc 1 (40) Second, if v∈V−c Lv u0v ≤ D̃, then nv = u0v , ∀ v ∈ V−
P
c is
an optimal solution. Otherwise, model (48)–(51) can
y + ≥ 01 (41) be seen as a shortest-path problem with an objective
−
y ≥ 01 (42) function that depends on the total quantity delivered.
This shortest-path problem is defined on the follow-
where uv (respectively, lv ) is an upper (respectively, ing network G = 4N 1 A5, where N and A are its node
lower) bound on the number of voyages to contract and arc sets, respectively. First, assume that the ships
c that ship v can start in time interval i. Typically, in V− −
c are numbered from 1 to —Vc —. Set N contains
lv = 0; but branching decisions can increase its value. the following nodes (see Figure 5 for an example with
Initially, uv = ‘—Ti —/Tcv ’, but it may be reduced by three ships, u01 = 3, u02 = 1, and u03 = 2):
branching decisions. • One source node, denoted 401 05.
From (39), we obtain • One sink node, denoted 4—V− c — + 11 05.

X • u0v + 1 nodes for each ship v ∈ V− c , denoted

y− = D + y+ − Lv nv 1 (43) 4v1 051 4v1 151 0 0 0 1 4v1 u0v 5.
v∈Vc Arc set A contains two types of arcs:
• Select arcs link a node 4v1 k5, k ≥ 0, to the node
which can be substituted in (38) and in (42) to yield 4v + 11 05. Such an arc indicates that ship v performs
the following reformulation of the subproblem: k voyages to contract c in time interval i.
 • Increase arcs link a node 4v1 k5 to the node
min C D− D −  + 4C D+ + C D− 5y + 4v1 k + 15. Such an arc specifies that ship v must

D−
X
+ 4‚v − C Lv 5nv (44) 1, 0 2, 0 3, 0 4, 0
0, 0
v∈Vc
X
s.t. Lv nv ≤ D + y + 1 (45)
v∈Vc

lv ≤ nv ≤ uv 1 nv is integer ∀ v ∈ Vc 1 (46) 1, 1 2, 1 3, 1
+
y ≥ 00 (47)

Without the y + variable, this model would correspond

to a bounded integer knapsack problem. With it, we 1, 2 3, 2
call it a bounded integer knapsack problem with soft
capacity.
Clearly, if ‚v − C D− Lv ≥ 0, nv can be set to lv , which
means that nv can be removed from the subproblem. 1, 3
Also, if ‚v + C D+ Lv < 0, nv can be set to uv and can be
removed from the problem. Figure 5 Example of a Network G
 Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
394 Transportation Science 49(2), pp. 384–401, © 2015 INFORMS

perform one additional voyage to contract c in time be two labels associated with the same node. Then, E1
interval i. dominates E2 if
With each arc 4i1 j5 ∈ A, we associate a cost cij . This
cost is given by Z1 ≤ Z2 and Q1 ≤ Q2
 and at least one inequality is strict. In this case, E2 can
K
 if i = 401 051
be discarded. When both relations hold at equality,
k4‚v − C D− Lv 5 if 4i1 j5 is a select arc

cij = one label can be discarded, but the other must be kept.
and i = 4v1 k51
Given that the quantity delivered is not con-


0 otherwise.

strained, the following stronger dominance rule (that
These arc costs allow computation of the value of a can discard more labels) can be used: E1 dominates
solution except for the penalty term 4C D+ + C D− 5y + in E2 if
(48). To determine this penalty, we also associate the
Z1 + 4C D+ + C D− 5 max801 Q1 − Q2 9 ≤ Z2 0
following delivered quantity qij with each arc:
 With this rule, a label E2 may be discarded even if
kLv if 4i1 j5 is a select arc and i = 4v1 k51 Q2 < Q 1 .
qij =
0 otherwise.
4.2. Handling of Valid Inequalities
Any path — from the source node 401 05 to the sink Three families of valid inequalities (maximum num-
node 4—V− c — + 11 05 in G corresponds to a feasible solu- ber of loadings, minimum number of loadings, and
tion of the subproblem. Its reduced cost c̄— is given by timing inequalities) were defined in §3.3. All maxi-
  mum and minimum number of loadings inequalities
D+ D−
X X
c̄— = cij + 4C + C 5 max 01 qij − D̃ 0 defined for i = 1 are initially considered in the PBF.
4i1 j5∈— 4i1 j5∈— Indeed, they are not numerous (considering only the
nondominated ones as mentioned in §3.3), and the
A labeling algorithm (see Irnich and Desaulniers most effective according to our experiments. All other
2005) can be used to find the path with the least inequalities are generated as needed in a branch-and-
reduced cost. A label contains two components: cut fashion at each node of the branch-and-bound
Z gives the accumulated reduced cost and Q the accu- search tree. Enumeration is used to separate them. All
mulated delivered quantity. Starting from label E0 = required lower and upper bounds are, however, com-
401 05, the algorithm extends this label forward using puted once a priori.
extension functions. These functions are defined for
each arc 4i1 j5 and indicate how a label Ei = 4Zi 1 Qi 5 at 4.3. Branching Strategies
a node i is transformed into a new label Ej = 4Zj 1 Qj 5 To derive integer solutions, we apply a hierarchy of
at node j: branching strategies that all involve xcvt variables.
The choice of the strategy to apply at each node
Qj = Qi + qij 1 (52) of the search tree is based on two considerations.
Zj = Zi + cij + zij 4Qi 51 (53) First, branching decisions involving large sets of vari-
ables have, in general, a more significant impact on
where the lower bound than decisions involving small sets
 (including individual x variables). Second, branching

 0 if Qi + qij ≤ D̃1 on an entity (sum of variables) that takes a value
ˆ if qij > 0 and Qi ≥ D̃1 very close to an integer typically yields an unbal-

zij 4Qi 5 = D+ D−

 4C + C 5 anced search tree (for most nodes, the lower bound
increases much more in one child node than in the

·4Qi + qij − D̃5 otherwise.
other) and a larger number of nodes to evaluate (com-
The second case simply indicates that label Ej can pared with a balanced search tree). Consequently, our
be discarded because it cannot be extended to yield strategy selection procedure should favor entities that
an optimal path. Indeed, in this case, 4i1 j5 is a select involve large sets of variables and take a value in the
arc associated with a ship v ∈ V− c , and because ‚v + current solution whose fractional part is close to 0.5.
C D+ Lv > 0 implies cij + qij 4C D+ + C D− 5 > 0, it is not To weigh these two criteria, we use a scoring sys-
profitable to include voyages for ship v in the partial tem that defines a score for each entity. This score
pattern associated with label Ei . is computed as the fractional part of the entity mul-
Given that the above extension functions are non- tiplied by a weight associated with the strategy to
decreasing, the following dominance rule can be which belongs the entity and the number of variables
applied in the labeling algorithm to discard un- in this entity. In general, the larger the number of vari-
promising labels. Let E1 = 4Z1 1 Q1 5 and E2 = 4Z2 1 Q2 5 ables involved in an entity, the higher the associated
Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
Transportation Science 49(2), pp. 384–401, © 2015 INFORMS
weight. For instance, an entity may be defined on the
total number of voyages performed in a time interval.
Its weight depends on the duration of this interval.
In hierarchical order, the entities considered for
branching are the following ones, where we describe
an entity by the set of the indices (triplets 4c1 v1 t5)
involved in it:
1. Total number of voyages (to any contract) start-
ing in a time interval:
Ji = 84c1 v1 t5 — c ∈ C1 v ∈ Vc 1 t ∈ i ∩ Tv 9 ∀ i ∈ I1
S
where I = c∈CLT Ic is the set of all time intervals.
2. Total number of voyages transporting a gas type
and starting in a time interval:
Jg = 84c1v1t5 — c ∈ Cg 1v ∈ Vc 1t ∈ i ∩Tv 9 ∀ i ∈ I1 g ∈ G0
3. Total number of voyages sailed by a ship group
and starting in a time interval:
Jisg = 84c1 v1 t5 — c ∈ C1 v ∈ sg ∩ Vc 1 t ∈ i ∩ Tv 9
∀ sg ∈ VSG 1 i ∈ I1
where VSG denotes the set of ship groups. A ship
group is defined for each subset of ships that can
serve the same set of contracts.
4. Total number of voyages sailed by a ship and
starting in a time interval:
Jiv = 84c1 v1 t5 — c ∈ C such that v ∈ Vc 1 t ∈ i ∩ Tv 9
∀ v ∈ V1 i ∈ I0
5. Total number of voyages to a contract and start-
ing in a time interval:
Jic = 84c1 v1 t5 — v ∈ Vc 1 t ∈ i ∩ Tv 9 ∀ c ∈ C1 i ∈ I0
6. Total number of voyages to a contract, by a ship
group and starting in a time interval:
Jic1 sg = 84c1 v1 t5 — v ∈ sg1 t ∈ i ∩ Tv 9
∀ sg ∈ VSG 1 i ∈ I1 c ∈ Csg 1
where Csg is the set of contracts that can be served by
the ships in group sg.
7. Total number of voyages to a contract, by a ship
and starting in a time interval:
Jicv = 84c1 v1 t5 — t ∈ i ∩ Tv 9
∀ v ∈ V1 i ∈ I1 c ∈ C such that v ∈ Vc 0
8. An individual voyage:
Jcvt = 84c1 v1 t59 ∀ c ∈ C1 v ∈ Vc 1 t ∈ Tv 0
395
Let 4x∗ 1 q ∗ 1 z∗ 5 be a fractional-valued solution com-
puted at a node of the search tree. Consider one of
the entity e described above and denote by Je its cor-
responding setPof indices. Its value in this solution is
given by e∗ = 4c1 v1 t5∈Je xcvt ∗
and its fractional part by
∗ ∗ ∗
fe = —e − ‘e − 005’—. Thus, its score is computed as
fe∗ × we , where we is the weight associated with e. To
determine which branching decisions to impose, the
score of each entity e is first computed and the one
with the highest score is selected. Denote by ē this
entity. The decisions imposed are then
X X
xcvt ≤ ē∗  and xcvt ≥ ‘ē∗ ’0
4c1 v1 t5∈Jē 4c1 v1 t5∈Jē
A best-first search strategy is used to explore the
enumeration tree.
5. Computational Study
To evaluate the two proposed models and how the
lower bounds obtained by the PBF compare with
those of the BVF, we introduce a test set of 27
instances. These are described in §5.1. First, in §5.2
a comparison of the lower bounds derived by the
PBF and the BVF without cuts are presented to see
whether the PBF is indeed a stronger formulation
than the BVF. Then, in §5.3, we assess the impact of
the valid inequalities proposed in §3.3 on the qual-
ity of the lower bounds. Finally, a comparison of the
bounds and the times required to derive optimal and
heuristic solutions is presented in §5.4 for both for-
mulations with all cuts.
The branch-price-and-cut algorithm for the PBF
was implemented using Xpress-MP 7.2 and Mosel
3.2.2. The B&B tree and the cut separation algorithms
were written in C++ and were called as modules
from Mosel. The BVF was implemented purely in
Mosel and solved with Xpress-MP. All tests were exe-
cuted on HP dl160 G3 machines with a 2 × 3 GHz
Intel E5472 Xeon CPU and 16 GB of RAM. The setup
has eight cores, but the algorithms were only allowed
to utilize a single core.
5.1. Test Set
In Rakke et al. (2011) and Stålhane et al. (2012), none
of the instances tested was solved to optimality within
86,400 seconds using the BVF. For this reason, we
chose to create a new set of 27 smaller instances with
shorter planning horizons to compare the two formu-
lations. These instances vary in terms of the num-
bers of ships and contracts and the planning horizon
length, as shown in Table 1. The number of ships is
15, 20, or 25; the number of contracts 7, 10, or 15;
and the planning horizon length 1, 2, or 3 months.
All instances with the same horizon length have the
same production and total demand; i.e., the instances
with more contracts have less demand per contract.
 Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
396 Transportation Science 49(2), pp. 384–401, © 2015 INFORMS

Table 1 Test Instance Characteristics Table 3 Root Node Lower Bounds for the PBF and the BVF Without
Cuts
Instance Contracts Ships Months
Instance PBF BVF Best sol. Diff. Gap closed (%)
1 7 15 1
2 7 15 2 1 2155005 −6135307 2158906 8190403 9906
3 7 15 3 2 231137 10136901 26196309 121768 7609
4 7 20 1 3 32180604 23146301 351638 9134303 7607
5 7 20 2 4 414 −6137609 21335 6179009 7709
6 7 20 3 5 22181406 10134808 25199607 12146509 7907
7 7 25 1 6 32166601 23142706 35104203 9123805 7905
8 7 25 2 7 −5008 −6170701 1186406 6165602 7707
9 7 25 3 8 22135008 9191804 25157503 12143204 7904
10 10 15 1 9 32105002 22185509 34145005 9119403 7903
11 10 15 2 10 16178208 6139508 17145703 101387 9309
12 10 15 3 11 43193008 32176801 46156008 11116207 8009
13 10 20 1 12 75163409 65190305 77129103 9173105 8505
14 10 20 2 13 151345 5132805 16112203 10101605 9208
15 10 20 3 14 41103508 32173608 43165901 8129901 76
16 10 25 1 15 75128803 65187807 76141706 9140906 8903
17 10 25 2 16 13153908 4179109 14145906 8174709 9005
18 10 25 3 17 40155704 32138609 43174706 8117006 7109
19 15 15 1 18 741743 65160606 75188102 9113604 8809
20 15 15 2 19 50129304 40146205 50129304 9183009 100
21 15 15 3 20 69112805 44179409 691411 24133306 9809
22 15 20 1 21 126112701 97156102 128164502 28156509 9109
23 15 20 2 22 42164104 33111409 43135209 9152605 9301
24 15 20 3 23 61165904 43188302 64155406 17177601 86
25 15 25 1 24 114116803 96107902 114159707 18108901 9707
26 15 25 2 25 411475 32173207 42184304 8174203 8605
27 15 25 3 26 61141302 43174805 64129008 17166407 86
27 113168607 95185307 114149900 17183209 9506
Average 12104501 8604
Even though the instances are not as long as a year,
the characteristics are the same as the instances for
the ADP, and the solution methods can be directly The results of these experiments are reported in
applied to the instances in Rakke et al. (2011). Table 3. For each instance we report the lower
To see how the PBF performed on the 12-month bound obtained at the root node by both the PBF
instances from Rakke et al. (2011), these were included and the BVF and the best-known integer solution
in the tests of the root node bounds. The charac- (upper bound). Columns “Diff.” and “Gap closed
teristics of these instances can be found in Table 2. (%)” present the absolute differences in the lower
Instances A1 and C1 are based on real case data pro- bound between the PBF and BVF and the percentage
vided by the producer, whereas instances B1 and D1 of the gap induced by the BVF that is closed in the
are reduced versions of A1 and C1, respectively. In root node by the PBF, respectively.
these instances some of the ships, contracts, and pro- The results in Table 3 clearly show that the PBF pro-
duction volumes are removed. vides a much stronger linear relaxation than the BVF.
Indeed, at the root node, the lower bound is increased
5.2. Lower Bounds by 12,045.1 on average, and more than 85% of the gap
To evaluate the strength of the formulations, we com- of the BVF is closed. This can also easily be seen in
pare the lower bounds in the root node derived by Figure 6.
the PBF and the BVF. The PBF was solved by branch- In Table 4 we present lower bounds for the origi-
and-price without cuts, and the BVF was solved by nal 12-month instances from Rakke et al. (2011) and
Xpress-MP without any cuts. Stålhane et al. (2012). Here, columns “BVF” and
“PBF” show the root bounds for the BVF and PBF,
Table 2 Largest Test Instances used in respectively. Column “Best sol.” shows the value of
Rakke et al. (2011) the best known solution, whereas columns “Diff.”
and “Gap closed (%)” present the absolute differences
Instance Contracts Ships Months
in the lower bound between the PBF and BVF and
A1 8 34 12 the percentage of the gap induced by the BVF that
B1 4 16 12 is closed in the root node by the PBF, respectively.
C1 17 46 12 Clearly, the PBF provides a much stronger linear
D1 8 30 12
relaxation than the BVF also for the original instances.
Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
Transportation Science 49(2), pp. 384–401, © 2015 INFORMS 397

99.6

98.9
100

97.7

95.6
93.9

93.1
92.8

91.9
100

90.5
89.3

88.9

86.5
85.5

86

86
80.9
79.7
79.5

79.4
79.3
77.7
77.9
76.9
76.7

76

71.9
% of gap closed in root node
80

60

40

20

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27
Instance

Figure 6 Percentage of Gap Closed in the Root Node by the PBF Compared with the BVF

Indeed, at the root node, the lower bound is increased the valid inequalities are very useful. For the no-cuts
on average by 50,239.5, and almost 80% of the gap of setting, only 11 of the 18 instances are solved to opti-
the BVF is closed. Figure 7 illustrates the percentage mality. Of the seven instances not solved to optimal-
of gap closed in the root node. ity, six reach the time limit, whereas for one instance,
Because these instances cannot be solved to opti- the computer runs out memory (instance 13). Among
mality within 36,000 seconds, we exclude them from the inequality families, the new maximum number of
the rest of this computational study. loading cuts exhibit the most impact. Indeed, when
they are not considered, only 12 of the 18 instances
5.3. Valid Inequalities can be solved within the time limit—that is, three
To decide the cut setting for the final tests, we per- instances less than when they are considered. The
formed parameter testing using different settings on a other two families of inequalities do not seem to
subset of the instances. This was done to test the effect have a huge impact on the computational times, but
of the valid inequalities. We decided to use the one- when either one of them is not applied, one addi-
and two-month instances to perform these computa- tional instance (instance 13) cannot be solved. In fact,
tional experiments. Considering a time limit of 36,000 we observed that, even if they do not help to increase
seconds, each instance was solved using the branch- the lower bound at the root node, they are sometimes
price-and-cut algorithm for the PBF and the following useful in the search tree. Because they are not harmful
five cut settings: all cuts, all except the timing cuts in any case, they will be included in the subsequent
(§3.3.3), all except the minimum number of loadings tests because they may provide value for the three-
cuts (§3.3.1), all except the maximum number of load- month instances.
ings cuts (§3.3.2), and no cuts. The results of these
tests are presented in Table 5. For each instance and 100
89.2
88.4

each cut setting, we report the lower bound computed

at the root node (including the cuts), the number of
73.4

nodes explored in the search tree, and the total com- 80

% of gap closed in root node

66.3

putational time. For each cut setting, the last row indi-
cates the number of instances solved to optimality 60
within the time limit.
When comparing the results of the all-cuts setting
against those of the no-cuts setting, it is clear that 40

Table 4 Root Node Lower Bounds for the 12-Month Instances 20

Instance PBF BVF Best sol. Diff. Gap closed (%)

A1 −68103102 −100173104 −47189702 32170002 66.3 0

B1 −27157406 −51178102 −24138509 24120606 88.4 A1 B1 C1 D1
C1 11447177000 11383111000 11471115200 64166000 73.4 Instance
D1 868129300 788190200 877195109 79139100 89.2
Figure 7 Percentage of Gap Closed in the Root Node by the PBF
Average 50123905 79.3
Compared with the BVF for the 12-Month Instances
 398

Table 5 Computational Results for the PBF with Different Cut Settings

All cuts No timing cuts No min loading cuts No max loading cuts No cuts

Root Time Root Time Root Time Root Time Root Time
Instance bound Nodes (s) bound Nodes (s) bound Nodes (s) bound Nodes (s) bound Nodes (s)

1 2157008 11 009 2157008 11 009 2157008 11 100 2155005 18 104 2155005 43 104
2 23113908 732 20206 23113908 658 19105 23113908 605 20902 23113700 948 25500 23113700 802 8404
4 1142808 23 108 1142808 23 200 1142808 27 207 41400 7 104 41400 55 202
5 22181806 121749 4129608 22181806 121989 4157301 22181806 131221 4189709 22181406 71862 2181001 22181406 131328 1191102
7 1107000 14 105 1107000 28 300 1107000 11 105 −5008 46 409 −5008 57 300
8 22135202 51284 2137104 22135202 41528 2100502 22135202 61183 2193001 22135102 61042 2172409 22135008 111377 2119309
10 16194108 19 107 16194108 22 108 16194108 16 108 16178208 65 505 16178208 53 203
11 43198209 108 4208 43198209 224 6905 43198208 113 5302 43193008 1221236 >361000 43193008 2281314 >361000
13 15161809 49 408 15161809 3881956 >361000 15161808 3181937 >361000 15134500 3041205 >361000 15134500 >27110304∗ >351376∗
14 41103508 688 35003 41103508 608 30405 41103508 435 24908 41103508 1271909 >361000 41103508 2111287 >361000
16 14107001 29 304 14107001 29 306 14107001 36 502 13153908 70 802 13153908 55 400
17 40155704 791506 >361000 40155704 841523 >361000 40155704 811265 >361000 40155704 831893 >361000 40155704 1361559 >361000
19 50129304 35 305 50129304 14 200 50129304 29 306 50129304 61 704 50129304 71 400
20 69112805 130 5501 69112805 114 5903 69112805 98 5602 69112805 291275 11156900 69112805 1801054 >361000
22 43135209 1 007 43135209 1 008 43135209 31 507 42164104 149 2804 42164104 37 304
23 61165904 561607 >361000 61165904 521191 >361000 61165904 491310 >361000 61165904 471883 >361000 61165904 1191049 >361000
25 42184304 1 008 42184304 1 008 42184304 35 702 41174800 71 1808 41147500 77 904
26 61141302 641225 >361000 61141302 631409 >361000 61141302 601174 >361000 61141302 781026 >361000 61141302 971135 >361000
Optimal 15/18 14/18 14/18 12/18 11/18
∗
Instance ran out of memory before it reached the time limit.
Transportation Science 49(2), pp. 384–401, © 2015 INFORMS
Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
Transportation Science 49(2), pp. 384–401, © 2015 INFORMS 399

5.4. MIP Solutions
In §5.2, the computational results showed that the
lower bounds produced by the PBF were much
stronger than the bounds of the BVF. This section
provides results showing that more instances can be
solved to optimality with the PBF than with the BVF.
For this comparison, the PBF was solved using the
proposed branch-price-and-cut algorithm considering
all valid inequalities, whereas the BVF was solved
with full cutting in Xpress-MP. Table 6 reports the
results of these tests that were performed on all 27
instances considering a 36,000-second time limit. For
each instance, the “Upper bound” column indicates
the cost of the best solution computed. The next
three columns provide, for the BVF approach, the
best lower bound achieved at the end of the solu-
tion process, the number of nodes explored, and the
total computational time. The same statistics are given
for the PBF approach in the following three columns.
Columns “Bound increase” and “Time gain (%)” pres-
ent the increase realized by PBF over BVF in the best
bound achieved and the computational time reduc-
tion it incurred as a percentage of the time required
by the BVF approach, respectively. Negative percent-
ages mean that the BVF approach took less compu-
tational time than the PBF approach. Finally, the last
row reports the number of instances solved to opti-
mality within the time limit by each approach.
From Table 6, we can see that the PBF approach
clearly outperforms the BVF approach. Indeed, the
former method can solve 18 instances to optimality
(9, 6, and 3 one-month, two-month, and three-month
instances), whereas the latter solves only 13 instances
(all of these were solved by the PBF approach). Fur-
thermore, except for three instances that were solved
in less than five seconds by both methods, the compu-
tational time required by the PBF approach is much
less than that required by the BVF approach: we
observe many computational time gains that exceed
90%. Looking only at the 18 instances solved by the
PBF approach, the average time used by the PBF
approach is around 11,500 seconds—at least 56% less
than the average time required by the BVF approach.
This speed-up is due to the better bounds provided
by the PBF and the proposed valid inequalities. Over
all instances, the best lower bound increases on aver-
age by 491 when using the PBF. We also observe a
significant decrease in the number of nodes explored
with the PBF approach. Finally, notice that the maxi-
mum gap (upper bound minus best bound) remaining
to close for the unsolved instances is relatively small
for the PBF approach. This maximum gap is much

Table 6 Computational Results Comparing PBF and BVF on All Instances

BVF PBF PBF vs. BVF

Upper Best Time Best Time Bound Time

Instance bound bound Nodes (s) bound Nodes (s) increase gain (%)

1 2158906 2158906 5 103 2158906 11 009 000 32

2 26196309 26196309 2521121 2162804 26196309 732 20206 000 92
3 35163800 35112907 111151583 >361000 35163800 21978 1131604 50804 >96
4 2133500 2133500 539 301 2133500 23 108 000 42
5 25199607 25199607 210541389 34114108 25199607 121749 4129608 000 87
6 35104203 34126302 112041507 >361000 35104203 149 20600 77901 >99
7 1186406 1186406 21591 1004 1186406 14 105 000 85
8 25157503 24189708 117271761 >361000 25157503 51284 2137104 67704 >93
9 34145005 33100501 9331184 >361000 34145005 338 63909 1144504 >98
10 17145703 17145703 117 207 17145703 19 107 000 38
11 46156008 46156008 611509 89008 46156008 108 4208 000 95
12 77129103 76145208 3611043 >361000 77128009 581745 >361000 82801 —
13 16112203 16112203 581 206 16112203 49 408 000 −84
14 43165901 43136909 212741202 >361000 43165901 688 35003 28902 >99
15 76141706 75174705 4041203 >361000 76141603 401284 >361000 66808 —
16 14145906 14145906 343 301 14145906 29 304 000 −11
17 43174706 41160909 211401611 >361000 43120603 791506 >361000 1159604 —
18 75188102 74195303 5201363 >361000 75184709 451417 >361000 89406 —
19 50129304 50129304 1 107 50129304 35 305 000 −111
20 69141100 69141100 111055 13605 69141100 130 5501 000 60
21 128164502 126134206 2411740 >361000 126182808 251401 >361000 48602 —
22 43135209 43135209 87 706 43135209 1 007 000 91
23 64155406 61179708 3141274 >361000 64130609 561607 >361000 2150900 —
24 114159707 114120706 1421075 >361000 114146504 91566 >361000 25708 —
25 42184304 42184304 111623 4607 42184304 1 008 000 98
26 64129008 62140500 5531864 >361000 64121205 641225 >361000 1180705 —
27 114149900 113146301 1751685 >361000 113197602 121584 >361000 51301 —
Optimal 13/27 18/27
 Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
400 Transportation Science 49(2), pp. 384–401, © 2015 INFORMS

99.8
Table 7 Computational Times for Computing Integer Solutions Within

100
100
100
100

100
98.8

96.4

95.8
100 5%, 1%, and 001% of Optimality for the PBF and the BVF

91
BVF PBF

74.7
80 <5% < 1% < 001% < 5% < 1% < 001%

66.1
Instance (s) (s) (s) (s) (s) (s)
% of gap closed

60 1 102 102 102 009 009 009

49.5
2 57007 1195301 2162803 20206 20206 20206
3 16002 — — 1131604 1131604 1131604
4 106 106 106 108 108 108
40
5 79503 5174609 8134308 4129607 4129607 4129607
6 35904 — — 206 206 206

21.1
7 106 106 106 105 105 105
20 8 2165705 — — 2137104 2137104 2137104
9 15005 — — 63909 63909 63909
10 206 207 207 107 107 107
0 11 4204 85803 85803 4207 4207 4207
3 6 8 9 12 14 15 17 18 21 23 24 26 27 12 1107407 — — — — —
Instance 13 108 204 206 408 408 408
14 28607 — — 35003 35003 35003
Figure 8 Percentage of Gap Closed by the PBF Approach for the 15 52703 121212 — — — —
Instances Not Solved by the BVF Approach 16 109 109 109 304 304 304
17 — — — 1111306 — —
18 2103708 — — — — —
smaller than that obtained by the BVF approach. 19 104 104 104 305 305 305
Indeed, Figure 8 shows the percentage of the BVF 20 2506 10601 13408 5501 5501 5501
gap closed by the PBF approach for each instance not 21 7191606 — — — — —
solved by the BVF approach. This percentage is com- 22 409 505 506 007 007 007
23 4191806 — — — — —
puted as 4BBPBF − BBBVF 5/4UB − BBBVF 5, where UB and 24 3150409 8179202 — — — —
BBi , i = PBF , BVF , correspond to the upper bound 25 306 306 901 008 008 008
and the best bound for approach i, respectively. 26 42608 — — — — —
In practice, planners have to manage the trade-off 27 9150805 27101904 — — — —
between computational time and solution quality. In
fact, they are often satisfied with near-optimal solu-
tions, especially if these solutions can be obtained in both cases, whereas the BVF approach could only
in relatively short computational times. In a last find 16 and 13, respectively. Here, we observe that
series of experiments, we compare the BVF and PBF the first good integer solution found with the PBF is,
approaches in this context. Using both approaches, most of the time, of very high quality (within 001% of
we solved all instances considering a tolerance on the optimality). Considering only the instances for which
optimality gap of 5%, 1%, and 0.1%. For these exper- both approaches found integer solutions within the
iments, the Xpress-MP maximal heuristic setting was optimality gap tolerance, the average computational
enabled at each node when solving the BVF, whereas time for the BVF is 281.6 seconds for the 5% tests,
for the PBF we only used the standard branch-price- 668.2 seconds for the 1% tests, and 922.5 seconds for
and-cut algorithm. The results are reported in Table 7. the 001% tests. For the PBF, the average times are
For each instance and each formulation, the column 527.8, 355.1, and 355.1 seconds for the 5%, 1%, and
“< x%” indicates the computational time required to
001% tests, respectively. These tests show that even
find a solution within x% of optimality, where the
without any heuristics or modifications to the branch-
optimality gap is computed with respect to the best
and-bound search, the PBF approach yields shorter
bound found in Table 6.
average computational time when high-quality solu-
As could be expected, the results in Table 7 show
tions are sought. When less precision is required, the
that more integer solutions within 5% of optimality
can be found with the BVF: 26 with the BVF compared BVF performs better.
to 19 with the PBF out of the 27 instances. This can be
explained by the heuristic setting of Xpress-MP that
allows for rapidly finding integer solutions that are 6. Concluding Remarks
not necessarily of very high quality. However, looking In this paper we have introduced a new formu-
at the number of integer solutions found within 1% lation and decomposition approach for a maritime
and 001% of optimality, the results are the opposite. inventory routing problem. The formulation differs
Indeed, the PBF approach found 18 integer solutions from path-based formulations used for many vehicle
Rakke et al.: A New Formulation Based on Customer Delivery Patterns for a MIRP
Transportation Science 49(2), pp. 384–401, © 2015 INFORMS
routing problems and inventory routing problems by
relying on delivery patterns associated with the cus-
tomers, not paths. We call this new formulation the
pattern-based formulation. To solve the PBF, we pro-
pose a branch-price-and-cut algorithm involving three
families of cuts. This new approach was compared
to a commercial MIP solver applied to the basic voy-
age formulation of Rakke et al. (2011). Computational
tests on a set of 27 instances with varying characteris-
tics show that the PBF provides better lower bounds
and allows us to solve more instances to optimality
than the BVF within a 10-hour time limit (18 ver-
sus 13 instances). Furthermore, the PBF approach suc-
ceeds in closing, on average, 85% of the maximum
gap left by the BVF approach for the instances that it
cannot solve. Finally, additional computational results
show that the PBF approach also outperforms the BVF
approach when seeking integer solutions with a tol-
erance on the optimality gap of 1%.
To solve larger instances, it seems promising to inte-
grate the work in this paper with the rolling horizon
heuristic (RHH) from Rakke et al. (2011). The major
issue for the RHH was that not all the problems of
the restricted subhorizons could be solved to optimal-
ity, and the solution process had to be interrupted
when reaching a predefined time limit. By using the
solution method proposed in this paper to solve these
problems in the RHH, it would be possible to drasti-
cally reduce the running time of the algorithm as well
as improving the solutions.
Acknowledgments
Thanks are due to the anonymous referees for many valu-
able comments. This work was partly supported by the
Research Council of Norway through the OPTIMAR and
DOMinant II projects and by the Natural Sciences and Engi-
neering Research Council of Canada. This support is grate-
fully acknowledged.
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