Era Group Inc. operates helicopters worldwide.
The company’s helicopters are primarily used to transport personnel to, from and between offshore oil and gas production platforms, drilling rigs and other installations. The primary users of the company’s helicopter services are international, independent and major integrated oil and gas exploration, development and production companies.
The company’s customers include Anadarko Petroleum Corporation, Petroleo Brasileiro S.A., and the Bureau of Sa...
Era Group Inc. operates helicopters worldwide.
The company’s helicopters are primarily used to transport personnel to, from and between offshore oil and gas production platforms, drilling rigs and other installations. The primary users of the company’s helicopter services are international, independent and major integrated oil and gas exploration, development and production companies.
The company’s customers include Anadarko Petroleum Corporation, Petroleo Brasileiro S.A., and the Bureau of Safety and Environmental Enforcement (BSEE), a United States (U.S.) government agency.
The company’s helicopter services include emergency response services, provided to customers primarily engaged in offshore oil and gas exploration, development and production activities and the U.S. government agencies that oversee these activities. Accordingly, the company’s results of operations are tied to the level of offshore exploration, development and production activity by oil and gas companies in the Americas, including the U.S. Gulf of Mexico and Brazil. In addition to serving the oil and gas industry, among other activities, the company provides utility services to support pipeline survey activities.
The company also leases helicopters to third parties and foreign affiliates, and for some lessees, provide services, such as logistical and maintenance support, training and flight and maintenance crews in addition to the helicopters. These third parties and affiliates in turn provide helicopter services to customers in their local markets, majority of which include oil and gas exploration, development and production companies.
In certain countries where it is beneficial to access the local market for offshore helicopter support, the company conducts its operations through subsidiaries, strategic alliances with foreign partners or through joint ventures with local shareholders. In Brazil, the company owns Aeróleo Taxi Aereo S/A (Aeróleo), a helicopter transport service provider to the offshore oil and gas industry headquartered in Rio de Janeiro, Brazil. In Colombia, the company owns a 75% interest in Sicher Helicopters SAS (Sicher), a major helicopter operator based in Bogota, Colombia with a presence in the existing onshore oil and gas market.
Equipment and Services
The company owns and operates three classes of helicopters:
Heavy helicopters, which have twin engines and a typical passenger capacity of 16 to 19, are primarily used in support of the deepwater offshore oil and gas industry, frequently in harsh environments or in areas with long distances from shore, such as those in the U.S. Gulf of Mexico, Brazil, Australia and the North Sea. Heavy helicopters are also used to support emergency response search and rescue operations.
Medium helicopters, which have twin engines and a typical passenger capacity of 11 to 12, are primarily used to support the offshore oil and gas industry, emergency response services, utility services and corporate uses.
Light helicopters, which might have single or twin engines and a typical passenger capacity of four to nine, are used to support a range of activities, including the shallow water oil and gas industry, utility services and corporate uses.
As of December 31, 2019, the company owned a total of 103 helicopters, consisting of nine heavy helicopters, 44 medium helicopters, 20 light twin engine helicopters and 30 light single engine helicopters. The company had commitments to purchase eight new helicopters consisting of three AW189 helicopters and five AW169 helicopters. The AW189 helicopters are scheduled to be delivered in 2020 and 2021. Delivery dates for the AW169 helicopters have not been determined. In addition, the company has options to purchase an additional ten AW189 helicopters. If these options were exercised, the helicopters would be delivered in 2021 and 2022.
As of December 31, 2019, 75 of the company’s helicopters were located in the U.S. and 28 were located in foreign jurisdictions. The company owns and controls all 103 of its helicopters.
Aviation Operating Certificates
In the U.S., and some foreign jurisdictions, the company provides and operates helicopters under contracts using a Federal Aviation Administration (FAA) issued Part 135 Air Operator’s Certificate (AOC) for various activities, primarily offshore oil and gas exploration, development and production, emergency response services and utility services. For operating contracts, the company is required to provide a complete support package, including flight crews, helicopter maintenance and management of flight operations.
When the company leases helicopters to customers that operate them on their own AOC, the company’s customers handle all the operational support except where its contracts require the company to provide limited operational support, which might consist of helicopter technical support, personnel and/or training.
Markets
The principal markets for the company’s transportation and emergency response services to the offshore oil and gas exploration, development and production industry are in the U.S. Gulf of Mexico, Brazil, Colombia and Suriname. In addition, the company has customers in Chile, India, Mexico and Spain.
The U.S. Markets: The company is a major supplier of helicopter services in the U.S. Gulf of Mexico, which is a major offshore oil and gas exploration, development and production region and a major oil and gas aviation market worldwide. The company operates from 11 bases in this region. The company’s client base in the U.S. Gulf of Mexico primarily consists of international, independent and major integrated oil and gas companies and the U.S. government.
International Markets: The company markets its services worldwide and has customers in Brazil, Chile, Colombia, India, Mexico, Spain and Suriname.
Brazil: The company owns a 50% economic interest and 20% voting interest in Aeróleo. In 2019, the company purchased the remaining economic and voting interests from its partner in Aeróleo, making it a wholly-owned subsidiary. Aeróleo operates from a network of three operating bases located in Brazil.
Colombia: The company owns a 75% interest in Sicher. Sicher provides helicopter services to Colombia’s existing onshore and expanding offshore oil and gas market.
Latin America: In addition to the company’s operations in Brazil and Colombia, the company operates helicopters in Suriname, and leases helicopters and provides technical support to an operator in Mexico.
India: In India, the company leases helicopters and provides technical support to an operator serving the offshore oil and gas industry.
Chile and Spain: The company leases helicopters to an operator in Chile and Spain.
Seasonality
A major portion of the company’s operating revenues and profits related to oil and gas exploration, development and production activity is dependent on actual flight hours. The fall and winter months have fewer hours of daylight, and flight hours are lower at these times. The months of December through February in the U.S. Gulf of Mexico have more days of adverse weather conditions than the other months of the year. In the U.S. Gulf of Mexico, June through November is tropical storm season. During a tropical storm, the company is unable to operate in the area of the storm. There is less seasonality in the company’s dry-leasing and emergency response services.
Customers and Contractual Arrangements
The company’s principal customers in the markets in which it operates are international, independent and major integrated oil and gas exploration, development and production companies. In the U.S. Gulf of Mexico, the company also provides helicopter transportation services to BSEE. The company’s leasing customers are other helicopter operators that operate its leased helicopters under their AOCs and retain the operating risk. These companies in turn provide helicopter transportation services primarily to oil and gas companies. As of December 31, 2019, approximately 12% of the company’s helicopters were utilized in the support of these leasing activities.
Government Regulation
In the U.S., the company holds the status of an air carrier under the relevant provisions of Title 49 of the United States Transportation Code and engages in the operating and leasing of helicopters in the U.S., and as such, the company is subject to various statutes and regulations.
The company is governed principally by the regulations of the United States Department of Transportation (DOT), including Part 298 registration as an On-Demand Air Taxi Operator, and the regulations of the FAA applicable to an FAA Part 135 Air Taxi certificate holder. Among other things, the DOT regulates the company’s status as an air carrier, including its U.S. citizenship. The FAA regulates the company’s flight operations, and in this respect, has jurisdiction over the company’s personnel, helicopters, ground facilities and certain technical aspects of the company’s operations. In addition to the FAA, the National Transportation Safety Board is authorized to investigate the company’s helicopter accidents (if any) and to recommend improved safety standards.
The company is also subject to the Communications Act of 1934, as amended, because of the use of radio facilities in its operations.
In addition, because the company’s operations generate, and in some cases, involve the transportation of hazardous wastes, the company is subject to the federal Resource Conservation and Recovery Act, which regulates the use, generation, transportation, treatment, storage and disposal of certain hazardous and non-hazardous wastes.
Competition
In the U.S. Gulf of Mexico, the company has various competitors, including among others, PHI, Inc.; Bristow; Rotorcraft Leasing Company LLC; and Westwind Helicopters. The company’s primary competitors in Brazil, among others, include, Lider Aviação Holding S.A., OMNI Táxi Aereo Ltda., and CHC Brazil.
The company’s leasing business competes against financial leasing companies, such as Lease Corporation International (Aviation) Limited; Lobo Leasing Limited; Macquarie Rotocraft Leasing Limited; and Milestone Aviation Group Limited, a subsidiary of GE Capital Aviation Services.
History
Era Group Inc. was founded in 1948. The company was incorporated in 1999 in Delaware.
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