Volga-Dnepr Group / Press-center / Media Coverage

The bane and boon of costly fuel

07/25/2008

Volga-Dnepr commercial director Dennis Gliznoutsa spoke to Lloyd's List in between a Red Arrows display team fly-by and a full-throttle attempt by Formula One driver Lewis Hamilton to race a Learjet.

One of the regulars at Farnborough these days is the Russian "ramp carrier" and scheduled freighter operator Volga-Dnepr.

Volga-Dnepr operates two distinct freighter fleets. The first is its 120-tonne capacity AN-124 and 40-tonne capacity IL-76 aircraft, essentially robust 'land anywhere' military freighters re-employed on civilian charters for heavylift, project cargo and humanitarian relief work following the collapse of the Soviet Union.

The second fleet belongs to its Air Bridge Carriers scheduled operator, deploying standard Boeing 747 freighters for the transport of regular containerised cargo. Volga-Dnepr commercial director Dennis Gliznoutsa spoke to Lloyd's List in between a Red Arrows display team fly-by and a full-throttle attempt by Formula One driver Lewis Hamilton to race a Learjet.

"The increased price of oil has less effect on the charter operators because the short planning phase, perhaps three to five weeks, means that we can build in the current fuel costs," Mr Gliznoutsa said.

In order to cushion the shock, Volga-Dnepr explains to shippers that it is the fuel price that has doubled and not the contribution to the airline's own bottom line.

For the scheduled operation, Mr Gliznoutsa says that trade lane imbalances, similar to those affecting deep sea carriers, and rising fuel costs mean that the company has to remain "flexible" in terms of routing.

The upside of the stratospheric fuel price is that the oil and energy industries are in full investment flow. That means heavy, awkward cargos are flying more frequently, and on longer journeys, in the quest for extraction from fields that were previously considered to be unprofitable.

All of this is good news for operators of AN-124s, whose onboard cranes, tilting nose and backdoor ramps make into self-sufficient visitors to those remote, unpronounceable airports so beloved of energy installations.

"Some of the exploration sites were considered too expensive to investigate and the projects were on hold," Mr Gliznoutsa says.

"That has changed now and the decision has been taken to re-open some of the sites."

The AN-124 and the IL-76 are not daily use aircraft but specialist workhorses well-suited for project cargo in the energy sector for drive-on, drive-off freight, he says. "But the second biggest boom segment for heavylift cargo, again an aftershock of the high oil price, is the demand for alternative power supply projects.

"We have seen a steady stream of charters to deliver wind and tidal power equipment, as well as solar panels." This sector has seen a noticeable increase in the last six months, particularly to the US, West Africa, Japan, Singapore, Indonesia and Australia.

The trend for manufacturers of million-dollar plant is to transport ever larger, more expensive and even heavier single pieces, thus greatly reducing the risk of any damage taking place during reassembly in a remote and inhospitable location. The specialist project shipping lines, such as Beluga of Bremerhaven, confirm this trend for heavier and bulkier single items.

Volga-Dnepr wants to expand its fleet with a new version of the AN-124, the 100 series, which will carry 150 tonnes, fly an extra 2,000 km and reduce the number of flight crew from seven to four. It wants to order 12 such aircraft, but needs other freight carriers ndash; and the Russian government ndash; to order a total of a least 40 AN124-100s before the production run would become viable.

If the idea takes off, the first of the new series will roll out of the hangar by 2015 at the latest.

There are also tentative talks on a bespoke AN-124, whose fuselage height (along with the ramp door) will be raised from 4 m to 6 m. These aircraft would be chartered long term to aerospace manufacturers and other hi-tech industries which have a constant flow of out-of-gauge cargo.

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