Professor Martin Savelsbergh

School of Mathematical and Physical Sciences

University of Newcastle

The Australian coal export industry is the largest in the world.  Australian coal exports play a significant role in supporting the Australian economy, and in meeting the world's need for coal.  Australia is the largest exporter of metallurgical coal in the world, and the second-largest exporter of thermal coal, with about 60% of world market share in the former and about 20% in the latter. These exports make up almost 15% of Australia's total export earnings.

The Hunter Valley coal region, exporting coal through the Port of Newcastle, is a major contributor to this economic powerhouse. It is the primary source of thermal coal exports in Australia. In 2008 Newcastle port's throughput was around 92 million tonnes, which constituted more than 10% of the world's total trade in thermal coal. The Port of Newcastle exports a greater volume of coal than any other port in the world.

Most of the coal mines in the Hunter Valley are open pit mines. The coal is mined and stored either at a railway siding located at the mine or at a coal loading facility used by several mines. The coal is then transported to one of the terminals at the Port of Newcastle, almost exclusively by rail. The coal is dumped and stacked at a terminal to form stockpiles. Coal from different mines with different characteristics is ``mixed'' in a stockpile to form a coal blend that meets the specifications of a customer. Once a vessel arrives at a berth at the terminal, the stockpiles with coal for the vessel are reclaimed and loaded onto the vessel. The vessel then transports the coal to its destination. The coordination of the logistics in the Hunter Valley is challenging as it is a complex system involving 14 producers operating 35 coal mines, 27 coal load points, 2 rail track owners, 4 above rail operators, 3 coal loading terminals with a total of 8 berths, and 9 vessel operators. Approximately 1700 vessels are loaded at the terminals in the Port of Newcastle each year.

In this talk, we discuss a number of optimization problems arising when trying to maximize the throughput of the Hunter Valley Coal Chain as well as a class of incremental network design problems inspired, in part, by capacity expansion problems encountered in the Hunter Valley Coal Chain.

Biosketch:  Martin Savelsbergh received the Ms.S in Mathematics from University of Amsterdam and PhD from Erasmus.  For the past twenty five years, Professor Savelsbergh has been leading both theoretical and applied research covering a broad spectrum from basic optimization methods to distribution system and supply chain optimization.  Sponsors of his work have ranged from agencies like AFOSR, NSF, US Army, and Australian Research Council, to companies such as Praxair, Ameritech, Yellow Roadway, DayJet, SAIA, and ExxonMobil.  Professor Savelsbergh’s research has appeared in many of the leading journals in the field, including Transportation Science, Operations Research, Naval Research Logistics, Networks, Mathematical Programming, SIAM J. on Discrete Mathematics, Discrete Applied Mathematics, Journal of Heuristics, and Journal of Combinatorial Optimization.