An S-92 with CHC supporting oil and gas operations off Norway (CHC Photo)
Karl Fessenden will step down Aug. 2 as CEO of Dallas-based CHC Helicopter, the company said on July 24.
Fessenden "was presented an opportunity that is an ideal fit for him both professionally and personally, allowing him to relocate back to his home in Cincinnati," according to CHC. "While his departure was not expected, he has built a strong, talented leadership team during his tenure and leaves the company in excellent hands. ... We are in a strong position both financially and in the marketplace and look forward to continuing to build on our success with minimal disruption during this change."
Dave Balevic, CHC's senior vice President of engineering and operations, is to take over as interim CEO at CHC, while the company's board of directors searches for Fessenden's successor.
A former executive at Pratt & Whitney, GE Energy and GE Aviation, Fessenden took the reins at CHC in February 2015.
CHC declined to say what new job Fessenden has accepted but said it is outside of the oil and gas industry.
Since emerging from bankruptcy in 2017, CHC has tried to focus on other business lines, such as air ambulance, search and rescue, offshore wind farms, and maintenance, repair and overhaul through its Heli-One unit.
"With activity in the oil and gas segment still somewhat slow, many of the providers serving that industry have been looking to diversify into other market segments," Raymond Jaworowski, a senior analyst with Forecast International, wrote in an email. "These include EMS, law enforcement, search-and-rescue, aerial firefighting, and even offshore wind energy. Most of these segments have been seeing increased demand for helicopters, although the EMS market (at least in North America) presents a somewhat more mixed picture."
"While oil prices have risen since they bottomed out in early 2016, this rise has been very erratic," Jaworowksi wrote. "Indeed, it could be said that the price of crude has been on a roller coaster ride in 2018 and so far in 2019. However, even a more consistent rise in crude prices would not soon lead to many sales of new helicopters from oil and gas service providers and other customers in that industry. An initial increase in demand from the energy sector would likely be met instead by a return to service of helicopters now in storage or by increased use of underutilized assets in industry fleets. There is an overcapacity of the type of helicopter models generally favored by oil and gas producers and service providers. We are probably two to three years away from significant new order activity for helicopters from the oil and gas market, and an economic recession during that time frame could delay this even further."
While overall oil and gas industry activity has been slow, CHC last month announced new contracts with Norwegian firm Wintershall Dea to support forthcoming drilling operations in the North Sea and with Shell to support that company's exploration and appraisal activities in Brazil.