Riding the Bumps

So he knows a thing or two about the roller-coaster ride associated with rotary wing, not only through years of hands on experience but also as President of the Australian Helicopter Industry Association.

And right now it is all about maintaining stability and momentum in the face of what Crook acknowledges is the longest downturn he has seen in his time in the industry – a phenomenon affecting rotary wing operations globally.

‘Right now it is all about maintaining stability and momentum.’

There have been signs in the past 12 months of a more optimistic outlook in Australia, with particular emphasis on the EMS and SAR sectors, some movement in resources, and a continued focus on mustering. CASA figures show overall rotorcraft fleet growth at around three per cent (April 2017-May 2018), up one per cent on registrations for the comparative time period reported in Australian Aviation last year.

However, Crook says that is still a long way short of the sustained eight to 10 per cent average annual national fleet growth recorded in the period between the early 2000s and 2008-9 when resource prices spiked and helicopter activity in oil, mining and exploration in particular was at its peak.
The doldrums swept in with the fall in prices, highlighted most dramatically in the crash in oil from a spike of $US145 a barrel in 2008 to a low of around $US30 a barrel in 2016. The paradox is that while there was a flow on to the cost of fuel across the aviation sector (including the subsequent long period of some of the lowest passenger aviation fares in history) the price differential hit the extraction and exploration sector hard.

That provoked issues across the board. As Crook puts it: “They just couldn’t get rid of the product they had at the price they wanted. That fed down.

Suddenly manufacturers were not selling the big offshore machines. Then the industry didn’t need the intermediate sized machines to lift the drilling equipment.

“Exploration was cut so they didn’t need the smaller helicopters. When prices are low people hang on to what they’ve got.”

‘When prices are low people hang on to what they’ve got.’
Peter Crook

Similar pressures affect the general charter and tourism sectors and while the Australian economy has remained relatively healthy, inbound tourism has proved susceptible to changing fortunes. Crook pointed out that sightseeing and tourism ferry flights, for example, are particularly sensitive to the health of the Chinese and Japanese economies, though there are definite healthier signs around the former.

The good news for fleet growth is that the oil price is winding back up ($US68 a barrel at the time of writing) along with increases in copper and gold, and Crook hopes the industry is over the worst. The helicopter fleet boom-bust cycle has a history of six to eight year peaks and troughs and as Crook says “we’ve been wallowing around the bottom for the past eight years.”

While right now there are no signs of what he calls “lightning bolt” improvement, he says he is hoping the picture improves by the end of this year.

By the numbers

CASA figures to May 1 show 2262 rotorcraft in the national fleet – 1393 (61.5 per cent) with a single piston engine power plant, 592 (26 per cent) single turb

ines and 276 (12 per cent) twin turbines. (The remaining single rotorcraft is an amateur-built, diesel powered DeltaD2).

The Robinson R22 continues to dominate the registry with 626 units (up 32 on figures to same time last year) with the larger R44 increasing from 496 units to 519. Bell is the third largest supplier on the registry with a total of 363 followed by Airbus with 276, led by the ubiquitous AS350 Squirrel series. Most prominent additions from Europe at the heavier end of the spectrum come from Leonardo Helicopters with two additional AW139s and three of the larger AW189s, first demonstrated in Australia by Leonardo last year and registered to Lloyd Aviation (CHC).

Other than a batch of brand new R22s and R44s, 2017-18 manufactured additions to the registry include four Bell Jet-Ranger 505 X types, two of which have gone to the Nautilus Aviation operation based in Cairns, one to Avanova Pty Ltd based in Broome and one to a Sydney-based business individual.

A state-by-state breakdown shows that Queensland continues to dominate helicopter numbers with 794 registrations (up 18 on the same time last year), followed by NSW with 480 (up 25), WA with 346 (up 8), Victoria with 292 (up 13) and the Northern Territory with 184 (up 5). South Australia, Tasmania and the ACT stand at 160 registrations (no change).

The most recent CASA annual report figures for flight personnel (2016-17) show 4375 current helicopter pilot licences, up 72 on the previous year. The year on year breakdown shows 811 Air Transport (no change on 2015-16), 2033 commercial (up 118), 1510 Private (down 51), and 21 recreational (up 5).

Those licences are shared among about 3500 helicopter pilots.

Meanwhile, civil helicopter movements at Australia’s 31 tower-controlled airports fell slightly. The Airservices Australia “Movements at Australian Airports” report for the calendar year 2017 shows a drop in activity to a total 401,384 movements compared with 405,132 in 2016 (down less than one per cent), but still 39,898 ahead of movements for calendar year 2015.

To conclude the statistical picture, Australian Transport Safety Board reports for the year to end April 2018 reflect 23 accidents involving helicopters, of which two were fatal. While any fatality is one too many, the overall accident rate does reflect an improvement over statistics reported by Australian Aviation in April last year: 36 accidents in 2015 of which six were fatal and 27 accidents in 2016.

We’re not alone

Peter Crook is quick to point out that Australia is not alone in experiencing an extended downturn. “It’s definitely a global trend,” he said.

‘It’s definitely a global trend.’
Peter Crook

In the short to medium term he sees the only sustained upside in SAR and EMS “after all, we can’t have them not working” borne out by new AW139s entering the country to supplement EMS fleet operators and a Bell 412EPI joining NSW Police.

One of the most comprehensive projects of recent times involves the $63 million joint agreement between Queensland-based Starflight, Kaan Air Australia and Sikorsky to refurbish 10 ex-US military UH-60 Black Hawks, with options for an additional 10. The world-first refurbishment program, based in Brisbane, is aimed at repurposing the Black Hawks for aerial fire-fighting in Australia and New Zealand and for year-round EMS and disaster relief.

John Skeen, the CEO of Starflight, described the project as a “game-changer for aviation in Australia” when it was announced last year.

“The helicopters are being purchased by an Australian company, will be registered in Australia and most importantly, will be fully maintained and supported in Australia by the helicopter OEM Sikorsky and its supply chain commitment, helping to boost local jobs in the area and guaranteeing ongoing supply chain support of our Black Hawk fleet,” he said.

In an update at the time of writing, Skeen said the program is progressing, dependent on the outcome of the current National Aerial Firefighting Centre (NAFC) tender process. The NAFC was formed last year to manage aerial firefighting resources across Australia.

He said the StarFlight Black Hawk program is consistent with the original plan based on the Sikorsky Australia refurbishment.

That work is set to include new high performance engines, upgraded gear boxes, installation of Helicopter Terrain Awareness and Warning System (HTAWS) and a general overhaul, all undertaken by Sikorsky at Pinkenba, Brisbane.

For now, Starflight has just added an AW139 to its fleet for emergency service and EMS SAR mission profiles. “The helicopter will form part of the StarFlight fleet and will be utilised both within the Group and also available for short and long term lease in Australasia,” he said.

The AW139 is also the centre-piece of an April announcement by the Perth-based helicopter contractor CHC to renew its contract with the RAAF for SAR services at five bases around Australia.

As part of the deal, six new generation AW139s will replace the current RAAF S76 SAR helicopter fleet and are in addition to an AW139 already on contract to the RAN.

The first of these aircraft, configured with four-axis auto hover, have already been introduced at the base in East Sale and a further five will be rolled out throughout the remainder of this year.

A nationwide focus on the 139 underlines the sustained patronage of the two level-D full flight simulators: the CAE 3000 series simulator as part of the Toll Aeromedical Crewing Excellence Training Centre at Bankstown, and the more recent Thales LifeFlight HEMS Academy simulator as part of the Aviation Australia education campus at Brisbane Airport.

It also underscores the importance of the Leonardo service centre and logistics facility opened at Essendon Airport last year to support its regional customers.

As an indication of the significance of SAR within the industry now and going forward, CHC revealed that 50 per cent of its Australian revenue comes from search and rescue services nationwide, despite the fact it is better known as a major contractor to resource companies.

That said, its services to the Woodside Petroleum were back in focus late last year with the introduction of two of the larger Leonardo variants, the AW189.

On the oil and gas outlook generally, CHC Regional Director Asia-Pacific Vince D’Rozario said that while market conditions remain difficult for everyone, there are small signs of change.

“There is some exploration activity beginning again but his will take some time to flow through the oil and gas supply chain and competition remains fierce.

‘There is some exploration activity beginning again.’
Vince D’Rozario

“That said, our customers are looking for innovation and fresh approaches to service provisions. An example is CHC bringing in the first super-medium aircraft into Australia. The two AW189s, along with the dedicated technical back up, are being flown out of Karratha to service Woodside’s North West Shelf operations.”

The twin-engine aircraft can be configured to carry up to 16 passengers. D’Rozario said the 189s will help CHC to efficiently manage Woodside’s longer range operations into the future while also providing a level of operational flexibility not previously seen in the Australian offshore market.

In addition to the 139s and 189s, CHC also operates Airbus Helicopters EC135s, AS365 Ns and AS332s, Sikorsky S-76s and S-92s, and Bell 412s.

On the charter and tourism front, one of the more prominent acquisitions – the first to enter service in the Asia-Pacific – went to North Queensland’s Nautilus Aviation in the form of two brand new Bell 505 Jet-Ranger X types, VH-VSB and VH-VTB as part of a continuing program of fleet improvement and upgrade.

In a comment when the 505s were delivered, Nautilus chief executive Aaron Finn was more bullish about the 2018 outlook given strong signs of recovery in 2017 and growth in the inbound Chinese tourism market.

China Southern Airlines now flies direct to Cairns while Brisbane Airport has added further Chinese services to its itinerary.

Reform fatigue

There is no doubt the issue of regulatory reform aimed at aligning CASA requirement with the International Civil Aviation Organisation and the European Aviation Safety Authority has led to several years of angst within the industry.

Hopes of a speedy resolution of reform changes to training (Parts 141 and 142) and licensing (Part 61) after the transition period began in September, 2014, have been dogged by delay, driven in particular by debate over whether some of the more stringent European regulations should apply to Australia.

Many operators have laid blame for some of the industry’s problems on repeated deferrals, and Peter Crook admitted he believed that resolution of Part 61 is still 12 months or more away.

This time last year, Nautilus’s Aaron Finn said “continued deferrals and time extensions create uncertainty for operators”, a sentiment largely supported by John Skeen this year in commenting on the industry outlook: “The helicopter industry in general has always been a difficult industry to master due in part to low rates of return on the very high investment needed to own and operate helicopters,” he said.

“Smaller industry players are also finding it difficult to fully comply with higher compliance and safety standards – many of which have or should have been in place years ago. Now faced with having to comply with these higher standards means a significant change to the business model and in many cases, newer technology helicopters to meet those standards.

“While the EMS/SAR sector has been a growth industry, it has been restricted to those companies that are able to meet the stringent requirements of mostly government and or off-shore sector compliance and modern aircraft capable of meeting these high standards.”

The difficulties have never been lost on Peter Crook and the AHIA, though he does deliver something of a different perspective on the negotiating process with CASA when he points out that, until recently, the association leadership was composed of four volunteers with limited time and limited resources.

The AHIA now has a CEO, Paul Tyrrell, who has a long aviation background, including as head of the Regional Aviation Association of Australia. Crook said Tyrrell has experience of the workings of government, lives in Canberra, and has been invaluable in navigating the bureaucracy, despite the fact he is “full time, just one day a week”.

Not that Crook is complaining about past, and continuing, debate with CASA in a relationship that he now describes as “co-operative and collaborative.”

“We are both starting to get a better appreciation for each other’s problems. CASA is starting to understand the helicopter industry better and the problems the industry has, both operational and financial. We, likewise, are gaining a better understanding of what their procedures and requirements are, driven largely by legal requirement,” he said.

‘We are both starting to get a better appreciation for each other’s problems.’
Peter Crook

Crook points to success in Part 141 and 142 negotiations as examples of substantial progress.

The original proposal required all twin-engine helicopter flight training to be undertaken only by Part 142 accredited schools, thus removing a significant element of flexibility and access for trainee pilots from schools offering Part 141. “We just suggested to CASA that only the big ones, the more complicated ones such as s92s, and 189s, two pilot, IFR, offshore ops, stay in 142; that if a 141 school has the right people and right licences it should be able to offer less complex twin engine training.”

On overall Part 61 issues, Crook says that initially the industry faced huge pressure over alignment with EASA regulations but it is now working well with CASA to forge a resolution.

“We have had a lot of success. For example, there was an incredible amount of flight checking requirement in the initial Part 61 proposal – way too many, and no way a company, let alone an individual, could afford the numbers of checks required.

“If, say, you had three helicopter-type ratings, and external load validation on your licence, and night VFR and low level, you were expected to do nine check rides on each aircraft on which you had the validation.

“Also, if you had an instrument rating and flew three helicopter twin engine types it could be interpreted you had to do an instrument rating check on each aircraft. Who can afford that at $6000-$7000 an hour to do that? We have rationalised that now. The platform that carries the instruments around is irrelevant. Now it’s one flight check in one helicopter, checking your three validations on that one machine. The same goes for your instrument rating. Similarly with your instrument rating – valid for any machine you fly that is IFR.”

Crook said he is conscious of the flow on effect of the downturn and regulatory issues on the health of flight schools and flight training.

“Because of the downturn there are fewer jobs, and because people can see that they are not spending the money on the training.”

He said the AHIA is working with CASA to find incentives to promote helicopter aviation as a career. As a first step, the association is offering free opening membership to student pilots in an attempt to build a support network.

“There was a proposal to increase the number of hours required for a commercial licence but we were instrumental in being able to restore it to the original 105-hour course. We disputed the additional flight training and sequences required and stated there was no safety case for them – just additional expenditure.”

Crook is aware that to continue to deliver results the AHIA, despite its largely voluntary leadership, has to try to raise awareness of its work as an industry representative as well as improve communication generally. He said he hoped Rotortech would result in some first class networking with a view to further inroads on the regulatory and other industry issues.

A little ripper

The dramatic world-first rescue of two teenage boys off the NSW coast in January by a Westpac sponsored Little Ripper drone cast a spectacular spotlight on a burgeoning aspect of the rotorcraft industry.

There are now 1297 Remotely Piloted Aircraft Operator Certificates on the CASA register, close to double figures for last year and indicative of the challenge facing regulators governing appropriate use of drones for everything from aerial photography to mapping, shark spotting and life-saving.
Ben Trollope, Chief Operations Officer for Little Ripper and a 10-year veteran of the helicopter rescue industry, is pragmatic about how drones fit into the rotorcraft airspace.

“I’ve seen both sides of it and there will always be a necessity for helicopters but drones are taking off whether we want them to or not. They are going gangbusters.

“It is an exciting new industry but it’s not too far away from the point where both (helicopter and drone) have to work together in unison and harmony to get the job done.”

He says Little Ripper also enjoys a great relationship with CASA although he believes there should be more consideration to greater regulation of the sub-two kilogram drone sector – governance or tracking so people are held more responsible and know the rules before they get airborne.

“But in relation to what we do and the rescue side of things, CASA are 100 per cent on board and very supportive of the way we think it needs to move forward.”

Interestingly, the Federal Government allocated $2.9 million in the Budget for further CASA management of drone safety standards and compliance – recreational and commercial.

The life saver drones are currently operating in NSW, joined more recently by Queensland’s Sunshine Coast and Cairns.

“It will continue to roll out as the (life-saving) clubs come on board and the overall authorities – Life-Saving Queensland and Life-Saving NSW – farm them out to each region,” Trollope said.

The catch-cry for his organisation is “more eyes, more places, more often”.

“You can’t afford to have helicopters running up and down our beaches every hour. With drones, which are cheaper and more cost effective, easier to run and less maintenance, it’s a solution we believe is life-saving.”

In terms of future drone applications, Trollope believes the sky’s literally the limit with 14 separate commercial arms already in play.

“If you can come up with an idea that can be done from the air, there’s no reason why a drone can’t do it,” he said.