Despite a turbulent time for most offshore sectors over the past 2 years, Douglas-Westwood’s (DW) latest analysis from the World Offshore Helicopters Market Forecast 2017–2021 projects USD 18 billion in oil- and gas- related expenditure over the next 5 years.
Since the oil price downturn, drilling and production activities have been falling across all regions, resulting in a 7% decrease in total oil and gas expenditure over the forecast period, compared to the preceding 5-year period. This effect has been compounded by the significant cuts in capital expenditure in the past 2 years and the current lack of project sanctioning.
In spite of this, the current global fixed and floating platform population, coupled with existing drilling and production activities from projects sanctioned prior to the oil price downturn will continue to drive demand for helicopter support services. With developments moving farther from shore, deepwater activity (>500 m) continues to be another strong driver, which has remained relatively sheltered from the downturn due to longer project lead times. Consequently, over the 2017 to 2021 period, DW expects a 3% compound annual growth rate in global oil and gas helicopter expenditure.
While projections for the coming 5 years are lower than previously anticipated in the 2015 forecast, the production support component of the market will remain more resilient to fluctuations in oil price compared to drilling. Passenger transfers to production assets will continue to account for the majority of spending, 60% on average between 2017 and 2021, as a large share of demand will arise from ongoing production support.
The coming years will remain an important time for the industry, as a new generation of medium-class helicopters, such as the Airbus H175 and the Leonardo (formerly AgustaWestland) AW189, have been introduced. These models have been developed to provide higher crew capacity, power, and range for a number of industries. The new-generation medium aircraft are highly efficient with advanced safety systems and are, therefore, expected to perform well in the offshore arena.
In the longer term, there is the prospect of high-speed rotorcrafts entering the market. Leonardo’s AW609 is expected to be the first commercially available tiltrotor serving the offshore sector. Certification of the first aircraft is anticipated in 2018.
Following a serious helicopter crash in April 2016 near Bergen, Norway, the Airbus H225 / EC225 Super Pumas remain grounded by the UK and Norwegian Civil Aviation Authorities with the most significant impact likely to be seen in Western Europe.
Source: Douglas-Westwood's World Offshore Helicopters Market Forecast 2017–2021.