Milestone Aviation, the world’s largest helicopter lessor, has witnessed a widespread surge in demand for heavy twin-engine helicopters. The Dublin, Ireland-based company views the current market as marking a turnaround from the doldrums of the last decade.
“Heavy helicopters in general were probably the most impacted during the [2016 to 2020] downturn, particularly in oil and gas,” said company CEO Pat Sheedy. “I think at its peak, we probably had up to 25 [Sikorsky] S-92s in storage; right now we have none, so those are all back activated.”
Milestone credits the reversal with the recent stabilization in the price of petroleum at more than $80 a barrel, which has spurred increased energy production and exploration and interest in larger-cabin helicopters.
“We’ve seen a steady demand since 2020,” Sheedy told AIN in an interview at Heli-Expo 2024. “You’ve seen very little deliveries of the S-92, but deliveries of competitor super mediums [Leonardo] AW189 and [Airbus] H175 have also been relatively constrained due to minimal order books on the lessor and operator side.”
As a result, the company said any existing oversupply in those segments has been worked off, leading to a more balanced supply/demand market.
With more than 80 S-92s in its fleet, Milestone is the largest owner of the type, with 60 engaged in oil and gas and the remaining equipped for search and rescue. That equates to approximately a third of the population of S-92s deployed in offshore energy. It owns the same proportion of the super-medium class as well.
Geographically, it sees strong demand from China, having just inked lease agreements with China Southern Airlines General Aviation for one S-92 to be based in Zhuhai, and with CITIC Offshore Helicopter for a pair of S-92s and a single Airbus H225, which will operate from the company’s Shenzhen base.
“We continue to own 19 H225s down from a peak of 27,” said Sheedy. “We had some in storage early on but have seen some of those tentatively returning to oil and gas, not in the North Sea. I think it’s unlikely that that aircraft will fly crew changes in the North Sea, even in the near future.”
Milestone also just announced a lease agreement for an S-92 from Brazilian operator Líder Aviação, one of the country’s largest operators. “Brazil in particular has been a hotspot for demand and will continue to be for the next two to three years,” said Sheedy. “New markets in Latin America like Guyana have developed for offshore, and Australia has been very robust.”
He added that while the North Sea remains a big market, the growth in demand in that region has been relatively flat.
With such a large investment in the S-92, Milestone is carefully considering the platform's future.“The S-92 entered into service in 2004; that means we are going to see some of those aircraft hit 20 years of age this year,” said Michael York, the lessor’s head of emerging markets.
He explained that those aging helicopters will gradually be phased out of the primary offshore transport mission into secondary roles, leaving a need for capable aircraft. “That replacement demand is going to be filled by new S-92s, new super mediums, depending on where the economics stack up, but there certainly will be a requirement for a refleet over the next five to six years.”
Those secondary roles for heavy twins could include firefighting or utility deliveries such as with UN food programs, a space traditionally serviced by older Russian-built helicopters.
“That market is going to expand for Western-built equipment given some of the issues there are supporting the Russian equipment—given the Ukraine invasion and various sanctions on Russian manufacturers," explained York. "We do see that as a growing space over the next five to 10 years where older S-92s and indeed H225s can operate.”