Momentum returning following low prices and volatility

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After a slow couple of years due to oil price volatility, enquiry levels have risen in 2017 and Volga-Dnepr Group global director for oil and gas, Fayçal Boumerkhoufa (pictured below) says momentum will return in 2018.

He says falling and volatile oil prices have resulted in numerous large scale projects being postponed in the upstream segment over the past few years.

Volga-Dnepr has been receiving an increasing number of enquiries, which he expects to continue throughout 2017 and the timeline for 2018 looking good.

Boumerkhoufa says: “As of yet the demand for our services is exceeding the forecast. The requirement is mainly driven by emergency transport and solution requirements.”

Volga-Dnepr has been providing transport solutions for the oil & gas industry for over 26 years, and Boumerkhoufa says it has experienced the market highs and lows alongside its customers.

Volga-Dnepr Group global director for oil and gas, Faycal Boumerkhoufa

He comments: “We expect to see more room for financial recovery in the Oil & Gas industry during 2018 and have already been engaged by some key players and project forwarders in a consultative manner in relation to several projects which are close to a Final Investment Decision (FID) between now and the beginning of 2018.”

Boumerkhoufa explains the Group’s approach is that improvement in the oil & gas segment reflects developments in other verticals.

He says: “The Group has always been an expert in recognising and assessing the opportunities, trends and tendencies related directly and indirectly to the Oil & Gas/Energy sector. The need for heavy machinery for infrastructure projects is a good example.”

Working in the oil & gas industry always results in interesting shipments, including supporting a major project forwarder delivering vital equipment for a liquefied natural gas production plant on the Yamal Peninsula in Northwest Siberia, which Boumerkhoufa says has been the perfect opportunity to demonstrate the value of Volga-Dnepr’s Cargo Supermarket service.

He says: “Volga-Dnepr Group has operated a series of An-124-100 and IL-76TD-90VD charter flights, combined with scheduled Boeing 747 freighter operations through our sister airline, AirBridgeCargo (ABC) out of Europe and the Asia Pacific region.”

Recent flights have included an Ilyushin IL-76TD-90VD out of Liege, Belgium and an Antonov An-124-100 out of Dalian, China destined for the plant in Sabetta, Russia.

Boumerkhoufa adds: “Since the start of our work for this project we have also operated IL-76TD-90VD flights from Frankfurt-Hahn Airport to Sabetta and utilised.

AirBridgeCargo’s scheduled 747 freighter services from Singapore to Frankfurt and from Shanghai Pudong Airport to Amsterdam, from where the shipments continued their journey by sea.”

He says the majority of cargo destined for the Yamal Peninsula project is delivered by sea but with the winter season affecting ocean freight due to ice, the time-critical shipments carried by Volga-Dnepr and AirBridgeCargo helped support the construction before the severe winter weather slowed down the project.

Volga-Dnepr has also had to design and manufacture special loading systems for oil & gas. It developed a unique solution to move a 70-tonne stripping tower for an oil refinery from the US to Iraq (pictured above).

Boumerkhoufa explains: “At 38.4m in length it was two metres longer than the cargo hold of our AN-124-100 freighter but our load planning experts found a way to safely carry the tower, meeting all customer requirements.”

Looking into the future, Boumerkhoufa says the outlook is positive in spite of the fast changing global geopolitical cycle and change within global economic drivers.

Asia, Africa and the Middle East remain of long-term importance, but he also says: “Domestic production in the US and the Gulf also account for a huge proportion of the market potential.

“We also view certain areas in South America as viable near future market, though the Latin American market in general has been branded the ‘opportunity of the century’ for the last two decades. Hopefully we will start to see this materialise.”