Ukraine – New military leaders try repossessing 26 leased Mi-8s

Ukraine – New military leaders try repossessing 26 leased Mi-8s

16-Jun-2014 Source: Ukrainian Helicopters

The following is an electronic translation of Ukrainian Helicopters response to an assertion by the new military leadership in Ukraine that the 26 Mi-8MTV-1 helicopters leased from the military should be returned, claiming breach of contract per this story 

Airline “Ukrainian Helicopters” for more than ten years of experience in the international air transport market, contributes to increasing the international prestige of our country, employs nearly 500 citizens of Ukraine and fills state treasury funds.

The airline’s fleet consists of 26 Mi-8 MTV-1 leased on a competitive basis to the Ministry of Defense and Ministry of Internal Affairs of Ukraine. On paper it was operating helicopters in practice – scrap. All aircraft were out of whack and needed major repairs, complete renovation and modernization. To lift helicopters in the sky and maintain their airworthiness, the airline has spent more than 750 million hryvnia, has also purchased the main aggregates (boosters, main gear, auxiliary power units, etc.), which are owned by airlines and is currently installed and operational on aircraft.

Throughout the 10 years of the lease contract the company strictly carries out its commitments and monthly transfer to the state budget of 5.5 million USD. Only in 2013 the state received 50.7 mln. For five months of the year in the state budget transferred 32.3 mln., And at the end of 2014 rents will be 60 million hryvnia. In addition, the airline has allocated charitable assistance to the Ministry of Defense of Ukraine in the amount of 12.5 mln. for the construction of housing for servicemen.

In addition to financial assistance to the State, “Ukrainian Helicopters” support the international image of our country, working for the World Food Program in 2005, and at the United Nations since 2007. Airline has won the trust and respect in peacekeeping missions (Haiti, the Democratic Republic of the Congo, Cote d’Ivoire, Sudan and South Sudan), humanitarian missions (Kenya, Mozambique, Myanmar, Somalia, Pakistan, Uganda, South Sudan). Only in 2013, our helicopter transported 112,000 people and 3,200 tons of cargo. In total for the all-time “Ukrainian Helicopters” they delivered to the destination over 478,000 wounded, refugees and peacekeepers brought in disaster zones 22,000 tons of humanitarian aid. Our crews extinguished the fires in Portugal, Turkey and Russia, and in 2007 and 2010 on a charitable basis – in Ukraine.

About 60% of the staff – reserve officers who were dismissed in connection with the reform of the Armed Forces. At his own expense to retrain airline pilots and technicians, giving them the opportunity to work and get a decent wage.

According leases during the onset of force majeure Airline is obliged to return the helicopters in the condition, in which they are at the moment, except for units that are owned by the airline. According to the current legislation of Ukraine such circumstances do not come.

In addition, the 20-Th from 26 chartered helicopters, according to the regulations of the Ministry of Defense and Ministry of Interior, fully developed TBO and can not be used in military formations. Therefore, according to the lease agreement, the airline has developed a schedule for implementation in 2014-2015 overhaul reconditioning 20 helicopters. The cost of repairs is nearly 670 million hryvnia. “Ukrainian Helicopters” are willing to invest the money and has sent two aircraft repair company on Konotop “AVIAKON”.

In the event of termination of lease agreements Ukraine will suffer substantial economic losses. Stop monthly constant flow of funds from the budget of the lease on the defense budget 2014-2015, the additional financial burden will fall, worth 670 million USD. Associated with the need to conduct thorough reconditioning aircraft.

At the same time, early termination of the contractual relationship Airlines with the United Nations as a result of the possible solutions to the situation, and concluded Airline helicopters on UN contracts lead to a number of negative consequences.

The airline is one of the largest carriers in the market of helicopter services in Africa and second only to Russian companies. Last used noncompetitive ways to combat and strong support from the leadership of the state. In case of termination by the Airline contracts they get complete control helicopter transportation market in Africa.

Cancellation of contracts with the United Nations unilaterally harm the international authority of Ukraine and put into question the country’s ability to comply with international obligations, as well as lead to damages and penalties for which reimbursement will be entrusted to the initiators of the cancellation of contracts (State of Ukraine and Airline). The amount of damage is estimated tens of millions of dollars. Such losses will lead to the termination of the Company’s operations. Thus, the work will lose about 500 people, and the state will receive helicopters, which can not be used because of the significant financial costs of repair and maintenance of airworthiness.

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