Oil and Gas Market Now a Headache for Helicopter Industry
The downturn in the offshore oil-and-gas market remains a prominent concern for the helicopter industry, the leaders of which are puzzling over the evolution of demand in the segment. “I am not sure I can put a number on the decline. Minus 30 percent might be a good number,” Mike Platt, CEO of Lease Corp. International said today at Helitech International 2015 in London.
Helicopters that were flying for exploration have been redeployed to oil-and-gas production platforms. History confirms that the production rate of helicopters built for offshore operators closely follows oil price and all operators now have excess aircraft, acording to Platt. “We are in a cycle where our customers require lower costs; they are squeezing us to a difficult point and we have to ensure this does not erode our margins,” said David Balevic, CHC Helicopter’s senior vice president of engineering and operations.
But LCI’s Platt expressed hope for the longer term, as 43 percent of rotorcraft in oil-and-gas operations are more than 25 years old and thus due for replacement. In the short term, however, LCI’s analysts are wondering about what to order for the next couple of years. “Oil price is unpredictable,” AgustaWestland senior vice president for business strategy Roberto Garavaglia said. Nevertheless, Bell Helicopter senior vice president of customer support and services Glenn Isbell noted that low oil prices are bad for oil-and-gas, “but help everybody else.”