PNG Air, PNG’s second domestic airline, is about to commence a new codeshare agreement with Virgin Australia. CEO Paul Abbot updates Business Advantage PNG on the agreement and the airline’s plans for the future.

Business Advantage PNG: What are your plans with Virgin Australia?

Paul Abbot: We are back into the codeshare market. PNG Air stepped out of that market in April 2013, but we’re back now, and it’s been driven off work we’ve got going with clients such as Newcrest [Mining] and St Barbara.

We’ve got people moving in and out of the Australian market. It gives us presence back in the international sector and in addition provides another option for our domestic travellers. And, I guess, in a sense, it also signals our aspirations to grow.

We always said we’d get back into the code-share market once we consolidated the domestic market. We have started to get some traction and the next step is codeshare. We’ll see where it goes from there.

‘I’d like to think that at some stage there will be access in the international terminal for a user-paid lounge that would cover the likes of ourselves and other operators such as Virgin, Qantas and Philippine Airlines.’

We’ll start with Port Moresby – Brisbane and then extend it out to other ports over the next two or three months. We’ll do a review in about six months to see how that’s performing and if we’re getting good growth there, then we’ll see how we can open it up.

BAPNG: How do you decide what routes you will support?

PNG Air’s Paul Abbot

PA: PNG Air has a predominately commercial focus when deciding routes. There’s concern about the community’s needs and we do operate a number of uncontested routes where we have a long history of service, but there’s got to be a viable business case to support the introduction of new routes.

We do a lot of charter work. It’s about 20 per cent of the business at the moment.

We are the fixed-wing supplier for Newcrest (Lihir Island) and for St Barbara (Simberi Island). We’ve been working with St Barbara for many years supporting their operation with both scheduled services and charter.

With Newcrest, we started in 2014 with scheduled services, expanded that in 2017 to encompass charter as well. On any one day of the week, we’ll have up to three ATRs overnight on Lihir Island.

BAPNG: What about a loyalty program?

PA: We’re working the mechanics at the moment. We had the basic plan developed about two years ago and shelved it because there were too many competing projects.

In terms of Virgin Velocity access for our codeshare services, we are working with Virgin on that and hope to have that kick in around November this year.

We have lounges in Lae and Mt Hagen that we use for our main corporate travellers. I’d like to think that at some stage there will be access in the international terminal for a user-paid lounge that would cover the likes of ourselves and other operators such as Virgin, Qantas and Philippine Airlines.

BAPNG: The airline has refreshed its fleet quite significantly over the last five years…

PA: Well, seven ATR 72s. We still have nine Dash 8s in the fleet. Twelve months ago, we converted one of the Dash 8s into a full freighter and that’s going very well. I’d like to think that if the cargo market continues to growth as it has over the last six months there could be potential for us to convert another one.

‘Our prime focus is to remain as a domestic provider.’

We have orders with ATR for another five 72s, with the first of those due early in 2020.

BAPNG: Where do you see PNG Air moving into the future?

PA: Our prime focus is to remain as a domestic provider. We might get involved in some short-haul regional work such as Jayapura [in Indonesia], anything with a two-hour/two-and-a-half-hours window max. Any international services over and above that would come off the back of a codeshare operation.

But we’re here to serve the people of PNG; that’s what our shareholder base demands [PNG Air’s majority shareholders are superannuation fund Nasfund and Mineral Resources Development Corporation] and that’s where we see our future. That’s our bread and butter, 100 per cent.