Regional Market Outlook on Offshore helicopters in APAC 

  • Global offshore helicopter demand market is expected to reach $3.98 billion by 2021, with a CAGR of 3.13 percent.
  • Discovery of deep water assets will be a key reason behind the increase in demand. However, supply market is expected to increase by 59 percent, as global oil prices are recovering

offshore-aviation-logistics-global-market-size

  • The offshore helicopter market is estimated at $ 3.51 billion in 2018 and is expected to grow to $ 3.85 billion by 2021 with an estimated CAGR of 3.13 percent
  • Crew transport from onshore to offshore site is major spending in offshore aviation logistics and is estimated to account for about 60 percent of the spending
  • The global market is expected to witness an utilization pick up of 59 percent for medium and large helicopter fleets, following the discoveries of deep water assets far-off from coast in the coming years
  • Offshore oil & gas helicopter expenditure is expected to be $16.5 –17 billion over 2018–2022, growing at 1 percent CAGR over the estimated period
  • Offshore wind-related helicopter expenditure is expected to be around $119 million in the forecasted period 
  • Demand is expected to shift toward the Mediterranean, East Africa,and Guyana in the coming years
  • Asia-Pacific is the third largest market for offshore helicopter fleet globally after North America and Europe
  • These three markets collectively constitute 60 percent of the overall offshore helicopter market
  • Shell, Statoil, ONCG, Conoco Phillips, Petronas, Chevron, Petrobras are the major buyers of offshore helicopter service and they constitute 45 percent of the total global demand

Growth Drivers 2018 –APAC

  • Drilling and production related support segment accounts for 86 percent of the total offshore helicopter flying hours for crew transfer

Offshore Production

  • Continuous demand for offshore helicopter comes from offshore production platforms
  • Transportation of crew to support production operations and other emergencies in the production platforms remain as the key growth driver
  • Production segment accounted for 55 percent of the total helicopter flying hours

Offshore Rig Count

  • Offshore rig counts in the geography is one among the demand drivers for helicopters, for crew transfer to the drilling rig
  • Exploration segment accounts for 31 percent of the total offshore helicopter flying hours
  • Reduction in new drilling activities over the last two years has reduced the demand for helicopter for drilling operation

Seismic & Other Activities

  • Seismic activities, pipeline activities, and transporting heavy equipment account for 6 percent, 3 percent, and 5 percent of the other offshore helicopter demand
  • Seismic segment is expected to increase gradually, as oil companies are expected to expand their drilling program once oil price goes up

New Generation Helicopters

  • Rising oil price is driving the need for even more efficient helicopters to cut short the expenses
  • This would boost the new super and medium-sized helicopter demand in the region

Replacements Opportunities of Old Fleet/ Ageing Fleet

  • One-third of the total fleets are over 30 years. Better performances, economics, comfort would give way to new helicopters

Off-shore Wind farms

  • New offshore wind farm projects in China, Japan, and Taiwan are expected to increase the demand for offshore helicopters
  • Floating wind farms are also capturing the market, where land availability is a constraint

Offshore Helicopter-Cost Structure Analysis

Owning and operating a helicopter might be difficult, considering the cost and maintenance. Therefore, cost saving is limited to the crew. By having its own roaster of pilot, clients can have better flexibility in operating the helicopters and this can help clients in optimizing the crew cost by 10 –15 percent in the crew cost

Cost Analysis

  • Helicopter charter rates cost splits into fixed and variable costs
  • Fixed costs includes crew cost, training cost, insurance, hangar fee and constitutes to 38.1 percent of the total cost 
  • Variables cost covers fuel cost, maintenance, and other crew cost like regulatory and testing costs
  • Aircraft maintenance is the key variable cost component with a share of 35 percent in the overall charter cost for helicopter, as it requires to keep them in a safe operating environment
  • Insurance charges are high for offshore helicopters than civilian helicopters, due to the high risk involved in it
  • Scope of cost saving is limited to the crew cost