Grounded: Empty jets sit out pandemic in Pyrenees

Air France A380s at Tarmac Aerosave’s storage facility in Tarbes, France. The picturesque airport has become a refuge for idle jets. (Reuters)
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Updated 28 June 2020

Grounded: Empty jets sit out pandemic in Pyrenees

  • About two-thirds of the global commercial airline fleet is currently grounded

TARBES, France: At the airport of Tarbes in France, row upon row of empty jets in liveries from Asia to Africa sit nose to tail, waiting out the coronavirus crisis in the foothills of the Pyrenees.

Air travel has tumbled to a fraction of normal levels due to the pandemic, grounding about two-thirds of the world’s fleet and stretching Europe’s largest aircraft storage company.

“Today there is no (travel) demand. That is why we have more than 200 aircraft on our sites,” said Patrick Lecer, CEO of Tarmac Aerosave, headquartered at Tarbes. The previous record for planes stored by the company was 150.

The crisis has turned the picturesque airport into a refuge for the industry’s biggest jets, symbols of globalization now looking out of their element amid green farmland. The terminal serving pilgrims for nearby Lourdes remains almost empty.

In the high-risk airline business, where brands come and go with little warning, Lecer is used to having to be flexible, finding space for aircraft on behalf of mainly leasing clients.

But the speed of the airline industry meltdown put the firm on an emergency footing as airlines sought space worldwide.

“I got called on a Saturday night by one client who said that the plane is in the air and arriving with you tomorrow morning,” Lecer said.

Most new arrivals go in “active” parking, ready to fly at short notice. Hydraulics are drained, moving parts get a coat of grease and fuel tanks are left 10 percent full to prevent seals drying.

After three months, aircraft must leave or go into longer-term storage, which includes protecting cabins and engines with bags of silica gel, like the sachets used to pack electronics.

“In an A380 you need 100 kg of silica. Humidity is the enemy,” Lecer said.

With so few planes flying, storage demand looks set to peak, Lecer said. But as airlines slowly restore flights, the industry faces new risks as government support eases and bills fall due.

“There is a risk of defaults, and if there are defaults airplanes will be recovered by their owners,” Lecer said. When that happens they get parked again until new operators emerge.

Tarmac Aerosave was set up to recycle jets by owners Airbus, Safran and SUEZ, but most revenue comes from parking jets between lease contracts.

The company has boosted existing capacity at Tarbes by 25 percent through optimization and is in talks with European airports to add more stand-by space, Lecer said.

It recently added a fourth storage site at Vatry in France on an ex-NATO fighter base. Now civil airliners wait out the pandemic there, with Airbus predicting it will take up to five years for air traffic to return to normal.

Iranian oil in perfect storm of storage shortage, low demand, sanctions

Updated 32 min 45 sec ago

Iranian oil in perfect storm of storage shortage, low demand, sanctions

  • Coronavirus, US economic action sees inventories reach bursting point

LONDON: Iranian oil production has reached its lowest point in almost four decades, according to industry experts, with the country’s storage facilities fast approaching full capacity.

The news comes amid a dip in Iran’s oil exports due to a crash in global demand, and in a period when its refineries have been hampered as a result of the coronavirus outbreak.

With over 11,000 confirmed fatalities, Iran has suffered the worst coronavirus outbreak in the Middle East, affecting all areas of industry. 

This has created a perfect storm for the country’s vital oil sector, with what little selling ability it has further disrupted by sanctions imposed by the US in 2018 following Washington’s withdrawal from the Iran nuclear deal.

Iran’s total liquid production dropped from 3.1 million barrels per day (bpd) in March this year to 3 million bpd in June, according to FGE Energy, which predicts that the figure will drop by an additional 100,000 bpd in July.

Crude production was as low as 1.9 million bpd in June, the lowest since the beginning of the Iran-Iraq war in 1981.

Exports also fell, with estimates varying depending on source — 100,000 bpd in May according to market intelligence firm Kpler, and around 210,000 bpd according to FGE — well under 10 percent of the 2.5 million bpd Iran exported in April 2018.

Iran’s onshore crude stocks, meanwhile, hit 63 million barrels in June, having been just 15 million barrels in January, according to FGE.

Kpler said Iran averaged 66 million barrels in storage throughout June, meaning that around 85 percent of the country’s total onshore storage capacity was full.

“However, it will technically not be possible to fill tanks to 100 percent, given technical constraints at storage tanks and potential infrastructure bottlenecks,” Homayoun Falakshahi, a senior analyst at Kpler, told Reuters.

Offshore the story is much the same, with options running out fast. Iran has 54 crude oil tankers, according to valuations specialist VesselsValue, and is thought to be using around 30 ships, mainly supertankers with a maximum capacity of 2 million barrels of oil each, to store over 50 million barrels of crude and condensate.

“The exact number of Iranian vessels on floating storage is a bit of a black box as they have all turned off their AIS (tracking transponder) signals,” said a spokesman for shipping group NORDEN.

“Storage is expected to continue as we do not see these vessels being able to trade anytime soon.”

The Iranian-American Harvard analyst Dr. Majid Rafizadeh told Arab News: “Thanks to the re-imposition of sanctions against Tehran by the Trump administration, the regime seems to have suffered a significant loss of revenue.
“Iran’s oil revenues and exports have been steadily declining since President Trump pulled out of the Joint Comprehensive Plan of Action and adopted a policy of ‘maximum pressure.’

“Consequently, the flow of funds to the Iranian regime has been cut off, thwarting the Iranian leaders’ efforts to fund and sponsor Bashar Assad’s regime in Syria and various terror groups.”