Business from oil & gas industry on the rise

In July 2006, Antonov Airlines and Volga-Dnepr Airlines put their heads together to form Ruslan International, the heavy air cargo charter specialists. Reflecting on the significance of the share of airfreight business from the oil and gas industry, Michael Goodisman, business development manager for Ruslan International, says the business from the oil and gas industry has been a very significant part of Ruslan’s overall business. He talks about the challenges and opportunities that exist in this sector. Cargo to and from Russia and Ukraine are outside of the Ruslan International joint venture agreement.

How significant is the volume of business from the oil and gas industry for Ruslan International?
The oil and gas industry has been a very significant part of AN-124 flying during the 25 years the AN-124s have been operating commercially. The level of our oil & gas flights from 2006 until present does approximately reflect that of the general cargo market dropping from a peak of 60 flights in 2008 to 30 flights in 2009 and then gradually increasing in the following years. In 2013 the oil & gas flights performed made up 20 percent of our total revenue and greatly exceeding the 2008 level. So far this year, we have performed 34 oil & gas flights.

Give us a sense of the number of charter flights you operate on a monthly basis for the transportation of equipment for oil and gas industry?
The number of flights we operate for oil & gas industry can vary quite widely. On average we perform around three or four oil & gas flights per month. However, on occasion significant or even very large numbers of oil & gas flight can be required in a short period, for example we performed 10 oil & gas flights last month and have reached levels of around 28 flights in one month. Having a fleet of 17 AN-124 airframes (the largest commercial fleet) allows us to comfortably meet such requirements.

Who are the clients you work in this specific industry?
Geographically, most exports of oil & gas equipment are from the US and Western Europe (UK, Germany, Norway, Italy, France, etc.). The main destinations range from central/south Asia (Kazakhstan, Uzbekistan, Turkmenistan, India) to middle-east (UAE, Saudi Arabia, Yemen, Iraq) to Africa (Nigeria, Libya) to Far-East (Australia, Singapore, Papua New Guinea, Korea) to south America (Brazil, Venezuela). It is fair to say that we have operated oil & gas AN-124 flights to/from most countries. The vast majority of our flights are booked through freighter forwarders and air charter brokers. However, we are finding that other companies in the chain approach us as well from time to time (some EPC, oil & gas majors and equipment manufacturers). This is a collaborative process. We constantly work with our customers in the way they wish to work.

What are some of the specific challenges in this sector?
The most common factor is the need to deliver an item in the shortest possible time (to keep an oil & gas project on schedule). So the challenge is to quickly address parallel issues such as cargo preparation, route selection and permit requests. Frames are often needed for the larger, heavier pieces to ensure they can have their load spread sufficiently to protect the cargo cabin floor and to ensure the pieces can be properly secured during the flight. This can include detailed frame design by our load planners who can produce 3-D CAD designs and stress analysis and even arrange for fabrication of these frames. Oil & gas discoveries can be made in remote locations. The challenge of getting as close as possible to these destinations can include operating the AN-124 close to its limits into relatively short runways with acceptably high payloads. In a few projects, oil & gas companies have chosen to extend runways or even build new runways. Our teams have advised on airport design requirements for the AN124, and followed this up with flight simulator analysis by our pilots to properly evaluate such airport designs with their surrounding terrain.

What is the current rate of growth seen in this business?
It is difficult to put a growth rate on oil & gas as single large projects can appear sometimes to give a boost to a particular year, but on average we can say that compared to the low point in 2009 we are operating about twice the number of flights now.

What are some of the innovative service offerings you have for the oil and gas industry?
Not necessarily just for oil & gas, but our advantage remains the size of our AN-124 fleet. This provides redundancy of operation and allows us to back up the promises we make in terms of schedules. The joint venture allows us the ability to keep up with largest oil & gas projects. Also, we are currently evaluating the AN-124 airframes with maximum payloads increased to 150T (from the current 120T), and most importantly are putting all our airframes through a life extension programme to ensure their continued operation for at least another 20 years. Through our shareholders we offer the full range of other project cargo aircraft types — AN-225, IL76, AN12, B747, so we are able to tailor our response to each oil & gas requirement.