global vectra helicorp ltd Management discussions


Global Vectra Helicorp Limited (GVHL) is the largest private sector helicopter operator in India. GVHL is listed on the National Stock Exchange of India Limited and the Bombay Stock Exchange Limited and is an ISO 9001-2015, ISO 14001-2015, and OHSAS 45001-2018 certified Company. These certifications overarch all GVHL activities, including flight operations, engineering, safety, quality control and commercial systems. GVHL is also proud to be a long-term Corporate Member of the Rotary Wing Society of India (RWSI).

The vision of GVHL is to continue to deliver world class standards of safety and service to Indias helicopter industry and to be the leader in Offshore Oil & Gas operations. We are positively disposed to the evolution of the helicopter industry in India and abroad. To capitalize on this, GVHL will continue to tailor its fleet and adapt its services to meet the dynamic needs of offshore and onshore markets.


Being the largest private sector helicopter operator in India, GVHL has always ensured that safety is paramount in its operations and has recorded over 3,20,000 accident-free hours to date and has also been commended for our safety initiatives, including being awarded "Operator of the Year" in 2016 and 2017 by the India Business Aircraft Operators Association. The unblemished safety track record of GVHL also makes it preferred supplier for the top rung of the country for corporate, religious and leisure travel. It has world class maintenance facilities having highly skilled engineers and experienced pilots to ensure safe, secure and uninterrupted services to the nation.


The major maintenance base for offshore fleet is Mumbai where all maintenance work is carried out including 5000 hours / 05 years check on its Bell 412 and 1200 hours / 04 years check on AW 139 fleet of aircraft in a 6600 sqm state-of-the-art hangar. This facility meets international quality standards and maintains all relevant certifications from the Directorate General Civil Aviation (DGCA) as a CAR 145 & CAR-M sub part G approved organization.

GVHL has a total staff of over 387 personnel, including pilots, engineers and support staff.


GVHL is actively involved in regular and stringent audit activities from some of the most prominent oil companies in the world, including British Petroleum, Total, British Gas, ONGC, Reliance, Dolphin Geo, CGG and Cairn, through their renowned auditing agencies like Hart Aviation, GSR, Airclaim Services, Schlumberger Asia Services Limited and Aviation Management Services. It is also fully compliant with all Indian Directorate General Civil Aviation (DGCA) auditing schedules (Operations, Maintenance, Safety and Quality) and also follows a rigorous

Internal Audit program. Further, GVHL undergoes thorough, independent financial auditing on a quarterly and annual basis.


With a modern and technologically advanced fleet of helicopters, Global Vectra Helicorp Limited has a wide range of capability to provide essential offshore and onshore services to strategic sectors:

• Oil and Gas

• Geophysical Survey

• Corporate and VVIP flights

• Aerial Photography

• Religious Tourism

• Emergency services

• Underslung operations

• Power Grid Construction and Maintenance CLIENTS

Our offshore team is dedicated to providing Air logistics services to the Oil & Gas industry majors like Oil and Natural Gas Corporation (ONGC), Cairn India, Reliance Industries Limited (RIL), Transocean (TSF), Shelf Drilling, British Petroleum, Schlumberger Asia Services Limited, Baker Hughes, Jindal Drilling, Aban, ADES and many more, under long term contracts with a major market share in the offshore helicopter market in India.

Dolphin Geo, Shearwater, Polarcus, Fugro, CGG Veritas, Results Marine & Western Geco have been our major Seismic partners for whom we have flown on the East and West Coast of India in the recent past and are hopeful for the same in the near future as well.

GVHL provides services to its clients under long-term contracts. These contracts range from one to five and seven to ten years including the extension options. Companies involved in offshore Exploration & Production activities have to use helicopter services extensively for Crew Change, Production, Cargo and Medevac tasks.


GVHL has its main operations and maintenance base at Juhu Airport, Mumbai with sub bases in various parts of India including: Juhu (Mumbai), S. Yanam, Rajahmundry, Suvali, Gadimoga, Imphal, Porbandar, Hyderabad, Itanagar, Katra, Raipur, Neelgrath and Vishakhapatnam.


GVHL is totally committed to maintaining the highest possible standards in its operations, maintenance and safety. GVHL introduced in India a full and formal Safety Management System (SMS) as per international recommendations and requirements of the Global Oil/Gas Industry and International Civil Aviation Organisation.

As part of our efforts to enhance our management systems, we have implemented an ERP (Enterprise Resource Planning) System from IFS AB, a Swedish company and one of the worlds leading providers of business software. Through this system we have integrated the management data of Flight Operations, Maintenance, Repair and Overhaul (MRO) processes, Quality Control, Logistics, Inventory Management and Finance.


Global Vectra Helicorp Limited shall provide safe, efficient and reliable helicopter services and we shall remain recognised as the operator of choice in our region. We shall also grow our brand internationally, by further enhancing our safety, quality and compliance functions, in line with internationally recognised standards and best practice principles for our industry.

• We are the first choice for helicopter services in India.

• Our commitment to maintaining our safety focus underpins all that we do.

• We deliver safe operations.

• We are cost effective and reliable, commensurate with high quality of service provided.

• We shall exceed our customer expectations.

• We shall achieve our objectives - because we know where we are today and where we are going tomorrow.

Our Mission is driven by our Management Team - but delivery comes from every member of our Company.


The Oil and Gas Sector is among the eight core industries in India and plays a major role in influencing the decision-making for all the other important sections of the economy.

Indias economic growth is closely related to its energy demand, therefore, the need for oil and gas is projected to increase, thereby making the sector conducive for investments. As of 2022, India retained its spot as the third-largest consumer of oil in the world.

The Government has adopted several policies to fulfil the increasing demand. It has allowed 100% foreign direct investment (FDI) in many segments of the sector, including natural gas, petroleum products and refineries, among others. The FDI limit for public sector refining projects has been raised to 49% without any disinvestment or dilution of domestic equity in existing PSUs. Today, it attracts both domestic and foreign investment, as attested by the presence of companies such as Reliance Industries Ltd (RIL) and Cairn India. India is already a refining hub with 23 refineries, and expansion is planned for tapping foreign investment in export-oriented infrastructure, including product pipelines and export terminals.

Indias crude oil production in FY2022-23 stood at 29.2 MMT.

Indias demand for energy is growing faster than any other major economy and the same trend is expected to continue.

Growth will come in all sectors due to favourable demographics supported by urbanization and industrialization.

The consumption of petroleum products during FY 2022-23 was at 223 MMT, with a growth of about 12% over the previous year. This growth in the petroleum products has been driven by growth in HSD at 12.1%, the largest contributor with 85.9 MMT and MS with 34.9 MMT consumption during 2022-23 at a growth rate of 13.4% over the previous year.

In both cases, volumes not only crossed pre-covid consumption by a margin but are also highest consumption in history, till date. The growth momentum continues in current year too.

Despite robust demand from the petrochem and aviation, annual demand growth is expected to decline from 2.4 mb/d in 2023 to just 0.4 mb/d in 2028, putting a peak in demand in sight, notably China and India, will continue to register growth throughout the forecast.

Around three-quarters of the 2022-28 increase will come from Asia, with India expected to surpass China as the main source of growth by 2027.


Upstream segment - exploration and production

• State-owned ONGC dominates the upstream segment.

• It is the largest upstream company in the exploration and production (E&P) segment, accounting for approximately 70% of the countrys total oil and gas output.

Midstream segment - storage and transportation

• IOCL operates a 14,701 km network of crude, gas and product pipelines, with a capacity of 94.6 MMTPA of oil and 20.0 MMSCMD of gas.

Downstream segment - refining, processing and marketing

• IOCL is the largest company, controls 11 out of 22 Indian refineries, and has a combined capacity of 80.7 MTPA.

• Reliance launched Indias 1st privately owned refinery in 1999 and has gained considerable market share (30%). In January 2021, the company operated its plant at 96.1% capacity.

• Nayara Energy Limiteds (NELs) Vadinar refinery has a capacity of 20 MMTPA, accounting for almost 10% of the total refining capacity.


The estimated conventional hydrocarbon resources in 26 sedimentary basins stood at 41.87 bn tonnes (oil and oil equivalent of gas), an enormous increase of about 49% in comparison to the earlier estimate of 28.08 bn tonnes.

India retained its spot as the third-largest consumer of oil in the world, as of 2021. Indias consumption of petrol products stood at 204.23 MMT in FY22, while crude oil production stood at 29.7 MMT. Assam, Gujarat and Rajasthan account for more than 96% of oil production in India. India has about 10,420 kms of crude pipeline network, with a capacity of 147.9 MMTPA.

India has 23 refineries - 18 are in the public sector, two in the joint sector and three in the private sector. Indias state refineries have upgraded their facilities to comply with a new government requirement to produce oil products with the equivalent of Euro VI emission standards. Indias total installed provisional refinery capacity stands at 249.21 MMT, making it the second-largest refiner in Asia. Private companies own about 35% of the total refining capacity.

India is one of the largest exporters of refinery products due to the presence of various refineries. In terms of trade, exports of petroleum products from India reached 62.7 MMT in FY22. The value of these exported crude oil and petroleum products stood at US$ 44.41 billion. In FY22, crude oil imports stood at 4.24 MBPD, which was worth US$ 120.4 billion.

According to the International Energy Agency (IEA), Indias medium-term outlook for natural gas consumption remains solid due to rising infrastructure and supportive environment policies. Industrial consumers are expected to account for 40% of Indias net demand growth. The demand is also expected to be driven by sectors such as residential, transport and energy.


According to the data released by Department for Promotion of Industry and Internal Trade (DPIIT), FDI inflows in Indias petroleum and natural gas sector stood at US$ 7.98 billion between April 2000-March 2022.

49% FDI is allowed in petroleum refining by the Public Sector Undertakings (PSU), without any disinvestment or dilution of domestic equity in the existing PSUs under automatic route.

Following are some of the major investments and developments in the oil and gas sector:

• In May 2022, ONGC announced plans to invest US$ 4 billion from FY22-25 to increase its exploration efforts in India.

• As of May 1,2022, India had 10,420 kms of crude pipeline network, with a capacity of 147.9 MMTPA.

• The total number of OMC retail outlets increased to 83,208, as of May 1,2022, from 59,595 in FY17.

• Exports of petroleum products from India reached 62.7 MMT in FY22. The value of these crude oil and petroleum products stood at US$ 44.41 billion. In FY22, crude oil imports stood at 4.24 MBPD, which was worth US$ 120.4 billion.

• In March 2022, the Board of IOCL approved plans to invest Rs. 7,282 crore (US$ 932.6 million) for the development of City Gas Distribution (CGD) network in 9 geographical areas (GAs).

• In March 2022, the Board of Oil India approved an investment of Rs. 6,555 crore (US$ 839.49 million) for Numaligarh petrochemical project.

• As of March, 2022, the oil sectors total installed provisional refinery capacity stood at 249.21 MMT, and IOC emerged as the largest domestic refiner with a capacity of 70.05 MMT.

• In January 2022, Indian Oil Corp. Ltd. (IOCL) announced plans to expand its city gas distribution (CGD) business, looking to invest Rs. 7,000 crore (US$ 918.6 million).

• In January 2022, Adani Total Gas Ltd (ATGL), a joint venture between the Adani Group and Total Energies, won licences to expand its City Gas Distribution (CGD) network to 14 new geographical areas, with an investment of Rs. 20,000 crore (US$ 2.62 billion).

• In November 2021, Oil and Natural Gas Corp. Ltd (ONGC) announced that it invested up to Rs. 6,000 crore (US$ 800 million) in its petrochemicals arm (ONGC Petro Additions Ltd.) to meet its equity requirements.

• Under the Hydrocarbon Exploration & Licensing Policy (HELP), the exploration acreage has now reached to about 2,15,000 sq. km. after 4 successful bidding rounds of Open Acreage Licensing Programme (OALP). The future exploratory work commitment comprises the following:

• 29,270 line km of 2D Seismic Survey o 43,272 square km of 3D Seismic Survey o 369 Exploratory Wells

• 290 core analysis to establish Shale Resources

These commitments have a potential to generate an investment of about USD 2.35 Bn in exploratory work alone.


Some of the major initiatives taken by the Government of India to promote oil and gas sector are:

• On May 21,2022, the Government announced a reduction in excise duty of Rs. 8 (US$ 0.10) per litre on petrol and Rs. 6 (US$ 0.077) per litre on diesel.

• In the Union Budget 2022-23, the customs duty on certain critical chemicals such as methanol, acetic acid and heavy feed stocks for petroleum refining were reduced.

• India will more than double its exploration area of oil and gas to 0.5 million sq. km. by 2025 and to 1 million sq. km. by 2030 with a view to increase domestic output, around 15,766 sq. km. has been offered to investors.


• Locating new fields for exploration: 78% of the countrys sedimentary area is yet to be explored.

• Increasing the share of natural gas: The government is working towards increasing the share of gas from 6.3% (July 2022) to 15% of the energy mix by 2030.

• Development of unconventional resources: CBM fields in the deep sea.

• Opportunities for secondary/tertiary oil producing techniques.



India is the worlds third-largest energy consumer globally.

• In February 2023, Indias oil demand rose to a 24-year high, which resulted due to a boost in the industrial activity. It was the 15th consecutive year-on-year rise in demand.

• Diesel demand in India is expected to double to 163 MT by 2029-30, with diesel and petrol covering 58% of Indias oil demand by 2045.

• Oil demand in India is projected to register a 2x growth to reach 11 million barrels by 2045.

• Consumption of natural gas in India is expected to grow by 25 billion cubic metres (BCM), registering an average annual growth of 9% until 2024.Energy demand of India is anticipated to grow faster than energy demand of all major economies on the back of continuous robust economic growth. Moreover, the countrys share in global primary energy consumption is projected to increase to two-fold by 2035.


India aims to commercialise 50% of its SPR (strategic petroleum reserves) to raise funds and build additional storage tanks to offset high oil prices.

• Indian government approved oil and gas projects worth Rs. 1 lakh crore (US$ 13.46 billion) in Northeast India. These projects are expected to be completed by 2025.

• Government of India plans to invest Rs. 7.5 trillion (US$ 102.49 billion) on oil and gas infrastructure in the next five years.

• The industry is expected to attract US$ 25 billion investment in exploration and production. Refining capacity in the country is expected to increase to 667 MTPA by 2040.


The FDI limit for public sector refining projects has been raised to 49% without any disinvestment or dilution of domestic equity in existing PSUs.


• In the Union Budget 2022-23, the customs duty on certain critical chemicals such as methanol, acetic acid and heavy feed stocks for petroleum refining were reduced.

• High-Speed Diesel was the most consumed oil product in India and accounted for 38.6% of petroleum product consumption in FY23. It is used primarily for commercial transportation and further, in the industrial and agricultural sectors.

• Indias consumption of petroleum products stood at 4.44 MBPD in FY23, up from 4.05 MBPD in FY22.

• Indias oil consumption is forecast to rise from 4.8 MBPD in 2019 to 7.2 MBPD in 2030 and 9.2 MBPD in 2050.

• Rapid economic growth is leading to greater outputs, which in turn is increasing the demand of oil for production and transportation.

• In FY23, crude oil imports stood at 4.67 MBPD.


• Demand is not likely to simmer down anytime soon, given strong economic growth and rising urbanisation.

• Gas consumption is projected to reach 143.08 BCM by 2040. The Government is planning to invest US$ 2.86 billion in upstream oil and gas production to double the natural gas production to 60 BCM and drill more than 120 exploration wells by 2022.

• According to the International Energy Agency (IEA), Indias medium-term outlook for natural gas consumption remains solid due to rising infrastructure and supportive environment policies. Industrial consumers are expected to account for 40% of Indias net demand growth. The demand is also expected to be driven by sectors such as residential, transport and energy.

• Indias natural gas imports increased at a CAGR of 3.2% between FY16 and FY23.

Post COVID-19 And Russia - Ukraine War - Impact on the Oil & Gas industry - A Perspective & its Recovery

It bears noting that 2023 marks the last Covid-19 transition year for global oil demand, with China the final major country to lift lockdown restrictions in December 2022 leading to a post pandemic oil demand rebound in the first half of 2023. Global oil markets are gradually recalibrating after three turbulent years in which they were upended first by the Covid-19 pandemic and then by the Russias invasion of Ukraine which sparked a surge in oil prices and brought security of supply concerns to the fore, helping accelerate deployment of clean energy technologies. Benchmark crude oil prices are back below pre-war levels and refined product cracks have now come off all-time highs after rising supplies coincided with a marked slowdown in oil demand growth in advanced economies.

The subsequent surge in mobility that prompted a release of pent-up oil demand appeared to be cresting in mid-2023 and is expected to lose momentum during the remainder of the year, thereby normalising baselines from 2024 onwards. In parallel, global supply-chain constraints and cross-border restrictions that characterised 2020-22 have also abated.

On a macroeconomic level, the impact of Covid-19 will be felt for years to come now that the unprecedented monetary and fiscal stimulus prompted by the pandemic is being withdrawn. Although direct Covid-19 fiscal support measures have largely been unwound, the immense spending programmes launched at the height of the pandemic will continue to stretch government finances, as debts undertaken will have to be repaid eventually. This is particularly acute in the current high interest rate environment as central bank liquidity is being withdrawn.

Aviation jet fuel use is forecast to complete the explosive phase of its rebound from Covid-era travel restrictions before the end of 2024. Thereafter, structurally increasing demand for longdistance travel, strongly associated with higher GDP in middle- income countries, will remain a key pillar of overall growth. Total jet/kerosene demand will rise by almost 2 mb/d between 2022 and 2028, but a substantial improvement in aircraft fuel efficiencies mean that it will take until 2027 to recover beyond 2019 levels. Similarly, fuel oil and gasoil demand for marine bunkers will continue to gain ground (+300 kb/d) in line with rising global GDP.

However, efficiency gains, spurred by progressively tightening International Maritime Organization (IMO) measures to reduce greenhouse gas emissions, will once again temper growth. On a regional basis, the expansion in global demand will be powered by faster-growing economies in the developing world - especially in Asia - while oil use in advanced countries contracts. Around three-quarters of the 2022-28 increase will come from Asia, with India surpassing China as the main source of growth by 2027.

Projections assume major oil producers maintain their plans to build up capacity even as demand growth slows. A resulting spare capacity cushion of at least 3.8 mb/d, concentrated in the Middle East, should ensure that world oil markets are adequately supplied throughout. Uncertain global economic conditions, the direction of OPEC+ decisions and Beijings refining industry policy will play a crucial role in the balancing of crude oil and product markets.


Although, India had taken a neutral stance, born of its historic strategic partnership with Russia, yet, it could not shield India from the ravages of a war of such scale.

Despite Indias limited direct exposure to the war, the combination of escalated supply disruptions and uncertainties due to the war deteriorated the situation and aggravated the challenges of the offshore helicopter industry in the country with escalated costs all around.

It had a direct adverse impact on all the related services especially the movement of aircrafts and ships which resulted in increased costs of transportation and insurance in addition to facing unprecedented delays in the mobilisation of helicopters to the clients, importing spare parts and undertaking overseas maintenance activities of the contractual helicopters.


Long Range Heucopters

Oil and Gas companies have started exploring options for deep- sea drilling and exploration of oil and gas on the countrys east (including Andaman) and west coasts for helicopters serving long range missions like H175 (650 NM), AW 189 (490 NM), H 225 Super Puma (450 NM), S 92 (540 NM), Bell 525 (580 NM) etc will be required in the near future.


The newly introduced UAV (Drone) technology is likely to play an important role in the future of offshore oil & as drones can get safe access to difficult locations and can do live streaming.

Drones can be utilized by oil and gas industry for remote monitoring, security and surveillance, maritime search and rescue, rust and corrosion detection, transport of mail, documents and material, gathering data for inspection purposes.

Other possibilities like predictive maintenance of critical infrastructure assets, offshore wind farm & power stations, drilling rigs, pipelines & transmission network, oil spill detection & oil spill damage assessment, oil/gas pipeline surveillance incident mapping, gas leak detection, facility security etc.


The Company has an appropriate system of internal controls to ensure that all activities are monitored and controlled against any unauthorized use or disposition of the assets and those transactions are authorized, recorded and reported correctly.

The Company ensures adherence to all internal control policies and procedures as well as compliance with all regulatory guidelines. The Audit Committee of the Board of Directors appraises the adequacy of internal controls.


The Company takes pride in the commitment, competence and dedication shown by its employees in all areas of business. Various HR initiatives are taken to align the HR Policies to the requirement of the business.

As on March 31, 2023 the Company has a total workforce of over 387 employees.


Statements in this Report on Management Discussion and Analysis, describing the Companys objectives, projections, estimates, figures and expectation may constitute "forward looking statements" within the meaning of applicable laws and regulations. Actual results might differ materially from those expressed or implied.

The company assumes no responsibility in respect of forwardlooking statements herein, which may undergo changes in future on the basis of subsequent developments, information or events.