The offshore helicopter market has finally started to recover following some three years of decline. Rotorcraft operators have reorganised, restructured and recognised that the outlook in the near-term is for modest growth. In our latest analysis, covering the period to 2022, we conclude that the market still presents opportunities for the supply chain. We expect notable changes in geographic focus, preference for more efficient rotorcraft and new applications for helicopters in offshore renewable energy.

Key Conclusions:

• Offshore oil & gas helicopter expenditure to total $16bn over 2018-2022, growing at a 1% CAGR over the period.
• Global utilisation will average 59% over the forecast across the medium and large helicopter fleet.
• Middle East to see highest average utilisation through to 2022.
• Offshore wind related helicopter expenditure emerging from a small base and projected to see a 39% annual growth rate.

Global helicopter fleet utilisation is estimated to have hit 54% in 2017, due to a combination of falling demand and increasing supply from orders placed pre-downturn. Oil companies have taken abrupt measures to control costs that have resulted in fewer journeys offshore and pricing pressure throughout the supply chain. In the large helicopter segment we have seen some heli types benefiting from grounding of H225 and future utilisation in this segment will ultimately be function of both market recovery and operator sentiment/preferences for the >100 units that are presently not in use.

In terms of demand growth, Westwood expects a move from the traditional deepwater areas of activity (Nigeria, Angola, US Gulf of Mexico and Brazil) into new frontiers such as the Mediterranean, East Africa and Guyana amongst others. This geographic expansion will require new bases being set up, and the re-allocation of unutilised units. Similarly, the offshore wind market offers a significant opportunity for helicopter operators, with almost 6,000 turbines to be installed globally over 2018-2022 and a global population set to reach almost 10,000 turbines by forecast-end. Increasing distance from shore and clustering will help to raise the commercial viability of helicopters for offshore wind, due significantly higher transfer speeds and the ability to service a larger number of turbines over a smaller period of time. As a result, Westwood expects a total of $119m of offshore wind related helicopter expenditure over the forecast, with a CAGR of 39%.