Can Air Peace MRO save billions spent abroad on aircraft maintenance?

By Dickson Omobola & Matilda Ikediobi

Barring unforeseen circumstances, Nigeria is expected to have an advanced Maintenance, Repair and Overhaul facility, MRO, at the Murtala Muhammed International Airport Terminal Two in Lagos by early 2027.

Given that local facilities are unable to meet market demands, industry stakeholders are excited about the possible impacts such a facility, to be established by Air Peace, would bring.

The reason for that is not far-fetched. Nigeria has about 12 scheduled domestic airlines, many, if not all, depend on foreign countries for major maintenance, known as C-checks and D-checks.

Although maintenance hangars in the country, including 7 Star Global Hangar Limited, ExecuJet Aviation Group AG and Aero MRO, recently reported a surge in patronage due to the unification of exchange rate, most airlines still ferry aircraft to Ethiopia, Morocco, Egypt, United Arab Emirates and South Africa, among others, for heavy maintenance.

Industry reports suggest that Nigerian carriers spend about $1.5 billion annually on aircraft maintenance abroad. In 2021 alone, domestic operators were said to have expended $2 billion overseas.

The situation still has not changed three years later, as Nigeria’s largest airline, Air Peace, revealed that it spent N180 billion outside the country for the same reason.

While the persistent capital flight has continued to worry industry stakeholders, this challenge has spurred Air Peace to commence building a N32 billion MRO facility.

Although the project is still months away from completion, many expect it to reduce the shortfall in the industry and provide employment opportunities.

The N32 billion maintenance hangar

Upon returning to Lagos from Brazil on August 27, after the Federal Government signed a Memorandum of Understanding that formalised the Bilateral Air Service Agreement, BASA, between Nigeria and Brazil and designated Air Peace as the airline on the route, Chief Executive Officer of the carrier, Allen Onyema, said as part of the gains from the agreement, the airline would build a hangar for maintenance, repair and overhaul, with Embraer providing technical support.

At the groundbreaking ceremony in Lagos on September 17, Onyema also explained that the facility, which would be built on 34,000 square metres of land with the help of Bank of Industry, BOI, would be completed in about 15 months.

According to him, with such an MRO, Nigeria would, among others, start attracting foreign investments because airlines all over the world would bring their planes for service.

He said: “This will be an MRO that can take wide body planes like the Boeing 777. It is going to be the biggest MRO in Africa because it will be able to take one 777 and five other planes at the same time.”

What do stakeholders think?

Guest on Aviation Scope, a Voice of People TV programme, former Public Affairs Manager at Accident Investigation Bureau, AIB, now Nigeria Safety Investigation Bureau, NSIB, Mr Tunji Oketunbi, recently explained what the country’s aviation sector could gain from a facility capable of handling C-checks.

Oketunbi, who identified stopping capital flight and attracting foreign exchange, among others as the benefits, said: “When you look at the importance of MRO to the nation’s aviation industry, we should be talking about it because for many years and up to now, we have not had the kind of MRO that we desire.

“There are certain levels of aircraft maintenance and they are broken into A-check, B-check, C-check and D-check. The A-check is just a normal routine maintenance, and we do that in this country. I mean after the aircraft flies for some time, it lands, then the engineers on ground do normal routine maintenance on that aircraft.

“For the B-check, it has virtually collapsed into A-check. Where the issue lies now is C-check, which is like overhauling the engine and significant parts or the system of the aircraft. During C-check, you are looking at avionics, engine and all other critical aspects of the aircraft, like the landing gear. So, the C-check is not normally done in the country. “When they want to do that, they fly the aircraft to other parts of the world, like Ethiopia, Morocco and probably South Africa. But in most cases, they go to Europe and Asia, Indonesia, Singapore and even America.

Capital flight

“Anytime an aircraft is taken overseas for maintenance, like the C-check, a lot of money, foreign exchange is spent. The number one economic benefit is that it stops capital flight because aircraft owners will be paying for maintenance in Naira.

Foreign exchange

“If an airline wants to go for a C-check now, the airline has to be looking for maybe $4 million dollars, $6 million dollars. If that is translated to Naira, you know what that means. So you do not have to be racking your head on how to get foreign exchange. I know foreign exchange has been a problem for us here. Again, once it is being done here, employment will be generated.”

Unemployment

Meanwhile, in a recent chat with Saturday Vanguard, President of the National Association of Aircraft Pilots and Engineers, NAAPE, Engineer Galadima Abednego, who lamented the unemployment faced by engineers in the aviation sector, also said a maintenance hangar such as the one being developed by Air Peace could serve as a major boost for young professionals.

Abednego, who expressed optimism that the sector would grow in the next 10 years, said going by what is happening, more employment opportunities would come.

He said: “I heard that Embraer is coming to have an MRO facility with Air Peace in Nigeria. Once we have such a needed investment in the industry, then unemployment will also be a thing of the past for our young people.”

Government’s role

For the Chief Executive Officer of Centurion Security & Safety Consults Group Captain John Ojikutu, retd, he urged government to mandate domestic airlines to use the facility upon completion.

Ojikutu, who spoke to Saturday Vanguard, said that would serve as an encouragement to the facility manager(s).

He said: “How many MROs do we have in the West Africa region? How many MROs do we have in Africa besides what we have in South Africa, Ethiopia, Morocco and Egypt? Most of the airlines we have in this country carry their aircraft out for maintenance and repairs, and it is capital flight. It is not done less than $5 to $6 million dollars.

“When you look at the number of airlines that we have in Nigeria and the aircraft they have, at least five or 10 of them go out of the country for that. When multiplied, it tells you how much money goes out. What is the profit these airlines make?

“Let me just hope that they will allow Air Peace to survive with this. If some of the airlines operating today in this country cannot do interlining, I hope the issue of capital flight will make them remain in this country if government controls capital flight and asks them to maintain their fleets at Air Peace.”

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