Addressing MRO, Aircraft Leasing in Aviation Sector

Chinedu Eze

Two major challenges have drastically affected airline operations in Nigeria. One is lack of large state-of-the-art aircraft Maintenance, Repair and Overhaul (MRO) facility and the other is the inability of Nigerian airlines to engage in dry leasing of aircraft.

Over the years, the federal government has campaigned and made promises about how it would establish MRO facility in Nigeria.

It said it would engage in Public, Private Partnership (PPP) to facilitate the establishment of the project, which is very crucial for successful airline operation.

Currently Nigerian airlines ferry their aircraft overseas at huge cost to maintenance facilities overseas. They pay so much money and this delays aircraft because the facility may be fully booked at the time the aircraft is ferried to the place so it would have to wait for its turn. Everyday an aircraft is on ground the airline loses revenues.

Another major challenge of Nigerian airlines is their inability to lease aircraft for a long term under dry leasing arrangement.

Lessors have ‘unwritten law” against Nigeria; that due to the failure to abide by leasing agreement by some defunct airlines, lessors would no more allow long term, dry lease to Nigerian operators.

The two challenges have prompted the former Minister of Aviation and Aerospace Development, HadiSirika, to make a promise on how to solve the challenges in the almost eight years he served as Minister. He did not solve any before he left office.

However, last week the current Minister of Aviation and Aerospace Development, Festus Keyamo travelled to France on a bilateral working visit and the two protracted problems were part of the issues he planned to solve during his visit.

Before the trip, Keyamo had made good advancement in getting lessors to review their relationship with Nigerian carriers and to allow them have dry leases.

Recently the Chairman and CEO of Air Peace, Dr Allen Onyema, thanked the Minister of Aviation and the federal government for the commitment to help Nigerian carriers by agreeing in principle to facilitate ways Nigerian carriers canlease aircraft on the long term.

Onyema said that by that promise, the government has indicated that it is not paying lip service to its plan to provide lifeline and support to Nigerian airlines and a positive revolution in the aviation industry is now imminent.

Also, the Chief Operating Officer of United Nigeria Airlines, Mr. Osita Okonkwo had commended the Minister, saying that the Minister had met with the international lobby group to prompt the lessors to remove Nigeria from their blacklist and this include Aircraft Leasing Group (ALG), comprising the two largest aircraft makers, Airbus and Boeing.

THISDAY learnt this was one of the reasons why the Minister embarked on the bilateral working visit to France.

According to the Special Adviser to the Minister, Tunde Moshood, the recent visit to France by the Ministerhas marked a significant milestone in fostering collaboration and addressing critical issues facing Nigeria’s aviation industry.

“During the visit, airline operators were privileged to interact with various manufacturers of helicopters and aircraft, gaining insights into different models and technological advancements. The delegation’s visit to Airbus Helicopters in Marseille and the aircraft manufacturing giant in Toulouse facilitated firsthand exposure to cutting-edge innovations and solutions within the aviation industry. Furthermore, the tour of ATR’s renowned manufacturing site offered valuable insights into the production processes of regional aircraft, highlighting the global standards upheld by industry leaders,” Moshood said.

He alsonoted that one of the pivotal discussions during the bilateral working visit centered on the challenges surrounding aircraft leasing in Nigeria, particularly the issue of insurance.

So, the delegation, led by Keyamo, engaged in discussions with Airbus and other French officials to identify viable solutions and chart a way forward. He added that the Minister’s proactive approach in addressing the complexities of insurance-related impediments reflects a commitment to streamlining processes and facilitating a conducive environment for airline operators.

“Minister Festus Keyamo underscored the government’s commitment to resolving longstanding issues hindering the leasing process for Nigerian airline operators. His advocacy efforts, including engagements with key stakeholders such as the Chief Justice of Nigeria and the Attorney General, demonstrate a proactive stance towards overcoming legal obstacles, such as “Jankara” injunctions, that impede lessors’ access to leased aircraft.

“The visit received an endorsement from Airbus CEO, Guillaume Faury, who emphasized the importance of collective efforts in resolving challenges within the Nigerian aviation sector. Faury’s recognition of Nigeria’s aviation potential underscores the significance of addressing critical issues to foster industry growth and attract investments. The collaborative spirit exhibited during the bilateral working visit signals a shared commitment among industry stakeholders to drive positive change and unlock the sector’s full potential,” Moshood further stated.

In the area of training, the visit made it possible for the Africa Aviation and Aerospace University (AAAU) to sign a partnership agreement with France’s school of aviation for strengthening the school and boost the image of the new institution.

Moshood said: “The icing on the cake for the bilateral working visit is the strategic partnership with the Africa Aviation and Aerospace University (AAAU) and the French’ school of Aviation, as the registrar of the Nigerian school, Mustapha Abdullahi Sheikh, and the Business Development Manager of Ecole Nationale de l’Aviation Civile, Farbrice Fabre, formalized a landmark collaboration through the signing of a Memorandum of Understanding (MoU). This significant milestone comes as a result of the visionary efforts spearheaded by the Honourable Minister of Aviation and Aerospace Development, Festus Keyamo in exploring avenues for mutually beneficial relationships in the aviation sector.”

Moshood added that the visit yielded positive outcomes for Nigeria’s aviation industry, including enhanced collaboration with aircraft manufacturers, proactive initiatives to address leasing challenges, and advocacy efforts to streamline regulatory processes, noting that as the sector continues to evolve, sustained engagement and collaborative endeavors would be essential in realizing the vision of a vibrant and sustainable aviation ecosystem in Nigeria.