By Siva Govindasamy
SINGAPORE (Reuters) - Singapore has delayed a decision on a $1 billion helicopter purchase after the crash in April of a civilian Airbus <AIR.PA> Super Puma whose military version was the frontrunner to clinch the order, sources familiar with the matter said.
The city-state, a highly sought-after customer for military contractors, had sought to replace 32 ageing Super Pumas but the move has now been put on ice until there is clarity over the fallout from the April 29 crash which killed 13 oil workers and crew off the coast of Norway, they added.
The delay comes as the helicopters subsidiary of Airbus Group, called Airbus Helicopters, wrestles with the latest in a series of setbacks to the H225 Super Puma, a workhorse of the offshore oil industry and widely used across the world for search and rescue and heavy military airlift operations.
Singapore’s procurement, pitting Airbus Helicopters against Italian firm Leonardo Finmeccanica <LDOF.MI>, marks the first major test of confidence in the military version of the aircraft since April’s crash, which led to the worldwide grounding of the civilian version.
A fresh tender is not on the cards, said the sources, who did not want to be identified due to the sensitivity of the matter. They could not say when a decision will be made.
Singapore has not so far announced any grounding of its military Super Pumas. Several other countries, including France and Brazil, continue to fly their Super Pumas.
Singapore's defense ministry did not provide an immediate response to a request for comment on the tender and its Super Puma operations.
"We cannot comment on discussions we may or may not be having with Singapore," an Airbus Helicopters spokesman said in an email
Safety is the company's "chief priority" and it is working with investigators to identify the "root cause" of the Norwegian crash, he added. It is also "providing support to customers who are flying mission-critical operations" with the Super Puma family of helicopters, he added.
Singapore has Southeast Asia's largest defense budget - even in the context of increased spending across the region as China becomes more assertive in the South China Sea. Modern military technology is key for Singapore, which needs to compensate for a small size and population.
The island has long sought to replace its Super Pumas, which have an average age of 27 years, and a decision was expected in the first half of 2016 after an 18-month-long evaluation.
While the Leonardo-Finmeccanica AW101 was also shortlisted, sources said that the Airbus H225M was the frontrunner.
The Norwegian crash happened after the main rotor blades separated from the aircraft. Norwegian investigators said on June 2 that they had found metallurgical evidence that was "strongly consistent with fatigue" in a part of the gearbox.
The next day, the European Aviation Safety Authority (EASA) grounded all civil Super Pumas. This decision, however, does not apply to military fleets.
(Reporting By Siva Govindasamy; Additional reporting by Tim Hepher in PARIS; Editing by Clara Ferreira-Marques and Muralikumar Anantharaman)