Introduction
My last column had introduced what is often deemed in the literature as the most fundamental observation related to oil refineries in energy economics. As Math Pro, 2011 noted: “Each oil refinery has a unique physical configuration, as well as unique operating characteristics and economies.” That article goes on to observe the configuration and performance of oil refineries are algebraic functions of their location; vintage; capital availability; crude oil availability; market specification and requirements; environmental provisions; and, “other” regulatory standards. The literature indicates two primary variables determine a refinery’s capability. Those are its complexity and size/capacity.
Today’s column extends last week’s discussion of these two variables.
