An Application of Monte Carlo Simulation Techniques to Spare Parts Managing Maintenance in Petroleum Industry

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Suwanna Ponpakdee
Nipas Leenatham


The objective of this research was to analyze the optimum spare parts order quantities for maintenance activities in petroleum industry by applying the Monte Carlo Simulation Techniques. Recently, the factory of interest is facing costly spare parts management issues due to the incomprehensive spare parts inventory system and rather than establishing a strategic method, the perception has been used to manage the movement and storage of the inventory. The lack of knowledge on how to implement an inventory system leads to a large stock of various parts. To address this problem, the researcher team attempted to propose practical spare parts management to cope with the unstable demand in order to achieve the lowest total cost. The research procedure began with defining and categorizing the spare parts into A, B and C groups. Group A, accounting for 80.34 percent of the net value, was selected for the analysis. The inventory policies were defined as (s,Q) and (s,S). The data obtained from a continuous survey of the inventory system were processed by applying the Monte Carlo Simulation Model.  It was found that (s,S) was the most effective policy for the inventory control that enabled the lowest total cost. According to the comparison between the (s,S) and the former purchasing plan the factory has carried out, the (s, S) strategy cost 75,394,160 baht per year while originally the factory had a total cost of 96,357,062 baht per year. Therefore, the Monte Carlo Simulation approach can reduce the total cost of inventory management of the spare parts for 20,962,902 baht per year. This 21.76 percent cost reduction has statistical significance with a corresponding 95 percent confidence level.


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Ponpakdee, S., & Leenatham, N. . (2020). An Application of Monte Carlo Simulation Techniques to Spare Parts Managing Maintenance in Petroleum Industry. Naresuan University Engineering Journal, 15(1), 66–80. Retrieved from
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