CHC Helicopter Loses North Sea Contract Renewal
CHC Helicopter's United Kingdom operating subsidiary, CHC Scotia Limited, was unsuccessful in its efforts to renew a contract to supply helicopter services to BP in the Northern North Sea. The current contract with BP, which produced revenues of $51.5 million in fiscal 2002, expires on July 31, 2004. This represents approximately 8 percent of CHC's revenues but less than 4 percent of EBITDA. CHC will continue to service BP under other contracts in the Southern North Sea, Angola, Norway, and Azerbaijan.
Sylvain Allard, the President of CHC stated: "Although it is disappointing that we were unable to secure a renewal of the BP contract on terms that would provide a satisfactory return to CHC shareholders, there is a worldwide shortage of heavy helicopters of the type used to service the BP contract. There continues to be a strong demand for these aircraft types so we are confident that we will be able to re-deploy the aircraft at market rates after the BP contract expires in 20 months. As our customers continue to develop oil reserves further from shore, the demand for modern heavy helicopters should continue to increase."