Importance We discuss the problems of oil and gas companies entrance to a new segment of the aviation fuel market in the regions of the Far North – the condensed aviation fuel produced from associated gas, which allows to significantly reduce the price of aviation fuel in these specific regions. Objectives First of all, it is necessary to estimate the potential demand for aviation condensed fuel in the Far North, which could create a major group of potential consumers – providers of helicopter operations and local airlines, both currently and in the long term. One also has to give cost-justified recommendations: should oil and gas companies to supply a new (cheaper to manufacture) fuel at the current price, or lower the price expecting the increased demand. Methods To predict the potential demand for aviation condensed fuel, we conducted feasibility calculations using the characteristics of modern and advanced aircraft. We take into account the possibility of helicopter fleet structure optimization (in the long-term) and population transport mobility increase due to the possible reducing the cost of air travel in the Far North. Results Our estimates show that the maximum possible volume of aviation condensed fuel production from gratuitous raw material will be enough for the transition into new fuel of all the helicopter operations that are performed in the Far North, and the increase of local traffic in 2–4 times. However, the cost-effective development of new fuel resources is possible only due to sufficient increase in demand for jet fuel and transportation, which in turn requires a flexible pricing policy. Conclusions and Relevance We obtained recommendations for oil and gas companies, as well as for advanced aircraft development. It is shown that the most significant improvement of the Far North regions transport service due to the transition to a new type of aviation fuel will be achieved using the transfer of a promising, more economical products to this fuel.
Keywords: air transport, Far North, strategy, condensed aviation fuel, demand, pricing policy
References:
Gorshkova I.V., Klochkov V.V. Ekonomicheskie problemy upravleniya razvitiem aviatransportnoi seti v malonaselennykh regionakh Rossii [Economic difficulties in steering the development of the air flight network in sparsely populated regions of Russia]. Upravlenie bol'shimi sistemami = Large-scale Systems Control, 2010, iss. 30, pp. 115–134.
Dutov A.V., Zaitsev V.P., Mavritskii V.I. Perevod aviatsii na gaz: varianty resheniya transportnoi problemy severnykh i arkticheskikh regionov [Switching the aviation fleet to gas fuel: options to address the transportation issue in the northern and arctic regions]. Arktika: ekologiya i ekonomika = The Arctic: Ecology and Economics, 2011, no. 3, pp. 80–89.
Gol'ts G.A. Infrastruktura i obshchestvo: printsipy strategii operezhayushchego razvitiya Rossii [Infrastructure and society: principles of the priority development strategy of Russia]. Ekonomicheskaya nauka sovremennoi Rossii = Economics of Contemporary Russia, 2000, no. 2.
Hileman J.I., Ortiz D.S., Bartis J.T., Hsin Min Wong, Donohoo P.E., Weiss M.A., Waitz I.A. Near-Term Feasibility of Alternative Jet Fuels. RAND Corporation, 2009, 152 p.
Popova T.I. [Innovative capabilities of using local fuel resources in aircraft of the Extreme North]. Rossiiskaya model' sotsial'no-ekonomicheskogo razvitiya: nastoyashchee i budushchee: materialy konferetsii [Proc. Sci. Conf. The Russian Model of Socio-Economic Development: The Present and the Future]. Krasnodar, Krasnodar Branch of Plekhanov Russian University of Economics Publ., 2011, pp. 204–210.
Kostromina E.V. Ekonomika aviakompanii v usloviyakh rynka [Economics of the air company in market conditions]. Moscow, Bankovskii Delovoi Tsentr Publ., 2002, 304 p.