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Passengers will be boarding flights en route to Sydney by late April after Mid-Western Regional Council unanimously voted to provide more than half a million dollars for the return of a regular air service to the region.
Fly Pelican will receive $677,400 between 2014 and 2017 including $195,000 over the first three months for licensing fees and $15,000 every month for the first 12 months.
Before flights begin, the airline charter service must apply for a Regular Passenger Transport licence with the Civil Aviation Authority (CASA).
Mid-Western mayor Des Kennedy said the return of flights will coincide with finalisation of a $2 million upgrade to Mudgee Airport.
The upgrade, secured through the Resources for Regions fund, includes the installation of navigational lighting, additional aircraft parking facilities and car parking.
The median price of a ticket will be $188 on a 17-seat flight. Prices will depend on availability with the cheapest ticket selling for $130 and the most expensive $250.
“This is a timely decision and announcement in terms of the work that is going to be completed at the airport in time for flights to start,” Cr Kennedy said.
“In terms of the wider demand for flights we’ve seen the announcement of Moolarben Stage 2 which is going to support that demand for flights that we have seen ever since Brindabella went into receivership.
“We’re already confident in the demand for the service and all indicators are showing that demand is only going to increase.”
Fly Pelican will operate 11 return flights between Mudgee and Sydney each week with two a day between Monday to Friday and one return service on Sunday.
The median price of a ticket will be $188 on a 17-seat flight. Prices will depend on availability with the cheapest ticket selling for $130 and the most expensive $250.
“We’re sitting quite well in the average price range for regional flights,” Cr Kennedy said.
Ticket pricing and the amount of ratepayer funds being invested into the project were among concerns raised by councillor Peter Shelley during Wednesday night’s vote.
He conceded it was “a gamble we have to take” but warned Mudgee could be without an air service “for good” if the venture failed.
In a report to council, senior staff acknowledged there was no guarantee that providing financial assistance would ensure the air service is commercially viable.
The report said while recent track record of regional aviation was poor, the owners of Fly Pelican operated the successful Aeropelican air service before it was sold to Brindabella Airlines.
Council said it’s taken steps to minimise risk by obtaining financial forecasts from the company and ensuring directors have no outstanding financial matters.
“We’ve been doing four or five months of due diligence into this, we’re confident it will work,” Cr Kennedy said.
“Since the day they stopped flights 14 months people have asked when will an airline return.”
Council surveys undertaken following the collapse of Brindabella indicate a demand for a regular passenger service between Mudgee and Sydney. It’s expected a successful air service will return $18 million to the region annually.
