Airlines feel the pinch in depressed sector

Thanks to the low oil and gas
prices globally, local industry
is preparing itself for the
likelihood of low demand for
oil and gas equipment.
That’s according to Sanjeev
Gadhia, CEO of Astral
Aviation, a cargo airline that
operates dedicated oil and
gas flights from its Nairobi
hub to Juba in South Sudan,
Lagos in Nigeria, Pemba in
Mozambique as well as to Dares-
salaam, Mwanza, Zanzibar,
Entebbe and Kigali.
“Prices have dropped and
one can therefore expect a
drop in demand for equipment
in southern Africa – even
Africa as a whole at the
moment,” he told FTW. “We
expect this will gradually
increase towards the third
quarter of the year and that
volumes will then start to pick
up,” he said.
A reduction in budgets for
oil and gas exploration along
with the postponement of
extraction of reserves were
the two most likely trends of
a depressed oil and gas sector,
he added.
“We are starting to see the
impact of this. Volumes have
been declining and are down
over 20% when compared to
2014.”
According to Gadhia, the
impact of lower oil and gas
prices on the economies of
Nigeria, Angola, Algeria and
Ghana will be challenging in
the immediate future.
But, he said, organisations
such as Astral remained
committed to the oil and gas
industry and to improving its
service offerings.
“We have therefore recently
commenced flights for oil
equipment from Nairobi to
Lokichar in Turkana which is
the area near a site where there
is ongoing exploration for oil.”
National Airline Service is
the GSA for Astral Aviation.