Supply Chain Risk Management in LNG Import Terminals through Proactive and Reactive Operational Strategies

Large-scale disruptions have recently buffeted enterprises, leading them to focus on risk management. In liquefied natural gas (LNG) supply chains (SCs), risks exist in different segments, including supply, demand, logistics, and terminal operations, and manifest as disruptions. The primary objective of this work is to systematically design operational policies and mitigation strategies to endow resilience to the SC of an LNG importer. A HAZOP-based approach is used for risk identification. Impact assessment is performed using an agent-based dynamic simulation developed in our previous work. Monte Carlo studies are conducted to quantify the costs and benefits of the proposed strategies. The proposed approach is demonstrated using two case studies: (1) mitigating disruptions through reactive recovery strategies and (2) reducing risks through proactive operational policies. The results indicate that significant improvements in the terminal operating profit, as much as 178%, can be achieved compared to the baseline. Further, it can be seen that disruptions can be adequately handled through robust operational policies without requiring onerous reactive interventions.