OCTOBER 13, 2020

KEY POINTS

• Demand will rise by 6.54 million barrels per day (bpd) next year to 96.84 million bpd, the Organization of the Petroleum Exporting Countries said in a monthly report.
• The growth forecast is 80,000 bpd less than expected a month ago.

Oil pumping jacks, also known as “nodding donkeys”, are reflected in a puddle as they operate in an oilfield near Almetyevsk, Russia, on Sunday, Aug. 16, 2020. Andrey Rudakov | Bloomberg via Getty Images

World oil demand will rebound more slowly in 2021 than previously thought as coronavirus cases rise, OPEC said on Tuesday, adding to headwinds faced by the group and its allies in balancing the market.

Demand will rise by 6.54 million barrels per day (bpd) next year to 96.84 million bpd, the Organization of the Petroleum Exporting Countries said in a monthly report. The growth forecast is 80,000 bpd less than expected a month ago.

Oil prices have collapsed as the coronavirus crisis curtailed travel and economic activity. While in the third quarter an easing of lockdowns allowed demand to recover, OPEC sees the pace of economic improvement slowing again.

“While the 3Q20 recovery in some economies was impressive, the near-term trend remains fragile, amid a variety of ongoing uncertainties, especially the near-term trajectory of COVID-19,” OPEC said of the economic outlook.

“As this uncertainty looms large, amid a globally strong rise in infections, it is not expected that the considerable recovery in 3Q20 will continue into 4Q20 and in 2021.”

OPEC has steadily lowered its 2021 oil demand growth forecast from an initial 7 million bpd expected in July.

The group also cut its estimate of world oil demand in the current quarter by 220,000 bpd. It left its estimate of the scale of this year’s historic contraction in oil use steady at 9.47 million bpd.

To tackle the drop in demand, OPEC and its allies, known asOPEC+, agreed to a record supply cut starting on May 1, while the United States and other nations said they would pump less.

In the report, OPEC said its output fell by 50,000 bpd to 24.11 million bpd in September. That amounted to 104% compliance with the pledges, according to a Reuters calculation - up from August’s figure of 103%.

OPEC also forecast demand for its crude will be 200,000 bpd lower than expected next year at 27.93 million bpd, because of the reduced global demand outlook.

OCTOBER 13, 2020

By Abdullateef Aliyu

Lagos — Air Peace has acquired a new ERJ-145 aircraft to boost its domestic and regional operations, raising its fleet capacity to 26 aircraft.

The 50-seater aircraft, with registration number 5N-BXF, arrived at the Murtala Muhammed International Airport at about 20:00hrs on Saturday, October 10, 2020, it was learnt.

Spokesperson for the airline, Stanley Olisa who confirmed this said, "We are very glad to announce the arrival of our eighth Embraer 145 Jet, another addition to the fleet of our subsidiary, Air Peace Hopper".

Olisa reiterated the airline's commitment to ease the burden of travel in Nigeria and beyond.

"We're also gearing up to receive two brand new 124-seat capacity Embraer 195-E2 Jets this October, the first set of the 13 we had ordered, with purchase rights for 17 more," he added.

Olisa affirmed Air Peace's ambition to interconnect various cities in the country and added that the flying public should expect more domestic and international routes to be launched, like Johannesburg, London, Houston, Guangzhou, Mumbai and other planned destinations.

OCTOBER 13, 2020

The Federal Government says it will double the number of airports in the country before the end of 2023 to enhance air connectivity and boost the nation’s economy.

The Minister of Aviation, Mr Hadi Sirika said this while responding to questions during the Public Presentation of the 2021 Budget Proposal on Tuesday in Abuja.

The public presentation was organised by the Ministry of Finance, Budget and National Planning.

“We understood the principles and the importance of air connectivity and it is a very important sector. It boosts our economy and we believe investment in this sector will do well for our economy.

“Before the end of 2023, we would have doubled the number of airports in Nigeria. We understand the importance of aviation infrastructure as a critical component for the working of our economy and our national security assets.”

Sirika said the aviation industry was the fastest growing sector in the country and the current administration had developed a roadmap to improve civil aviation and air transportation in general.

President Muhammadu Buhari presented the 2021 budget proposal to a joint session of the National Assembly on Oct. 8.

The 2021 budget is projected at N13.08 trillion, which is 21 per cent higher than revised 2020 Budget of N10.8 trillion.

Capital Expenditure for the Ministry of Aviation is put at N89.97 billion in the proposed 2021 budget.

However, the ministry proposes to spend N5 billion for safety and security critical projects and airport certification nationwide and N14 billion for construction of second runway at Nnamdi Azikiwe International Airport, Abuja.

Also, the ministry proposed N1.6 billion extension and asphalt overlay of Murtala Muhammed International Airport runway, Lagos; N1 billion construction of new terminal building in Enugu; and N1 billion construction of Abeokuta airstrip.

OCTOBER 14, 2020

Air passenger s wishing to come into Nigeria will not be allowed to board aircraft without a QR code certifying that they are COVID-19 free.

By Chike Olisah

The Federal Government says that air passengers wishing to come into Nigeria, will not be allowed to board aircraft without a Quick Response (QR) code certifying that they are COVID-19 free, with the introduction of a new online procedure.

While making the disclosure during a press briefing of the Presidential Task Force (PTF) on COVID-19, the National Coordinator of the task force, D r. Sani Aliyu, said the step has become necessary to ease congestion on arr ival at airports and to avoid the spread of infections. 

Aliyu noted that with over 4,000 passengers arriving daily in Lagos and Abuja airports, the use of paper at the airports would not be sustainable.  He added that the online procedure would make it easier to manage passenger s, following the increase in the number of passengers that could fly into the country.

Dr. Aliyu said, We have already increased the number of passengers that could fly into Lagos to 2,500 per day, while that of Abuja has been increased to 1,600 per day. We cannot continue to handle paperwork with this number of passengers coming into Nigeria. 

He also pointed out that the online procedure which involves producing a QR certificate before proceeding to the airport would also reduce the stress that passengers go through on arrival at the airport terminals.

Furthermore, he said, "The portal has three sections. The first section has to do with filling a straightforward questionnaire. The second step is to upload the COVID-19 Polymerase Chain Reaction (PCR) result that should be negative at the point of boarding. At this stage, you have two options, either to go ahead and pay or download your QR Code".

If you chose to download the temporary QR code, you can pri nt it and board with it and pay on arrival in Nigeria. Our strong recommend ation is that if you do not want to spend too much time at the airport, pri nt out the final QR Code. If you have the final QR Code, it takes minutes t o go through the airport protocol in Nigeria.

Since passengers filled questionnaires and PCR results can be seen online, it is easy to check after seven days if a passenger tested positive. Then, we can easily go back and check whether what we have on our system is a genuine PCR result or not.

Aliyu also said that they will check the questionnaire to see if an intending passenger admitted to having some symptoms before boarding.

OCTOBER 14, 2020

All international operations of cash-strapped Air Namibia (SW, Windhoek Int'l) remain on hold until further notice, but have not been indefinitely suspended, spokesperson Twaku Kayofa told ch-aviation, while the airline faces a court application for its liquidation.

Kayofa denied an earlier report by the Namibian Broadcasting Corporation (NBC), which said that the international flights were dropped permanently.

“The reasons, among others, are that borders of some countries, to which we operate, have not yet reopened. Air Namibia operates a network that requires multiple destinations in order to feed the network. Air Namibia will inform the public in advance regarding the restart of international flights. In the meantime, Air Namibia continues to offer charter flight operations worldwide,” he said.

Kayofa added the airline recently operated a charter flight to Johannesburg O.R. Tambo for the Namibian national football team and continues to service four destinations domestically, including Walvis Bay, Ondangwa, Caprivi, and Rundu.

On October 26, 2020, the Windhoek Supreme Court will hear an application from the Belgium administrator of defunct Challengair (1I, Brussels National) for the liquidation of Air Namibia. The case relates to outstanding settlement payments resulting from a longstanding dispute over Air Namibia's lease and maintenance of a B767-300(ER) from Challengair in 1998.

The airline also continues to negotiate with the Namibian government for a state bail-out, but Kayofa said no decision had been made yet. Air Namibia needs NAD8 billion Namibian dollars (USD484.2 million) to carry on as a going concern, but the government in its last budget only made 12% of the amount available.

Meanwhile, Qatar Airways (QR, Doha Hamad Int'l) suspended flights to the Namibian capital for the rest of 2020 barely two weeks after resuming four-weekly services from Doha Hamad Int'l on September 28, 2020. Spokesperson Noor Abdulla Jassmi said in a statement the airline was trying to operate as many flights as possible, but many routes remained commercially unsustainable due to the huge decline in global travel demand. "After careful consideration, we made the decision to suspend the Windhoek Int'l route for 2020," Jassmi explained.

Namibian newspapers reported chaos at Namibian land border posts with South Africa at the weekend as tourists were turned away and told they could only enter Namibia by air via Windhoek Int'l and Walvis Bay. The issue appeared to be limited COVID-19 testing facilities at the land border posts, reports said.

According to Namibia's Health Ministry, foreign nationals must present a negative PCR test result not older than seven days on entry. All arrivals, except tourists, must quarantine for seven days at their own costs.

OCTOBER 14, 2020

• Reps begin review of civil aviation Acts 

As the National Assembly begins the review of Civil Aviation Act 2006, aviation stakeholders have urged lawmakers to prioritise the autonomy of the Nigerian Civil Aviation Authority (NCAA), to revive the sector.

The apex regulatory body, according to the professionals, is in a better position to pilot the affairs of the sector; enforce safety and economic regulations of airlines and organisations, but without political interference.

The stakeholders also enjoined the National Assembly to ensure the Civil Aviation Act retains the five per cent Ticket Sales Charge/Cargo Sales Charge (TSC/CSC), which was the main source of NCAA’s revenue.

The House of Representatives Committee on Aviation has commenced the amendment of the Civil Aviation Acts 2006, with a pending three-day public hearing on the six Executive Bills brought to the National Assembly.

The Bills seek to amend certain aspects of the Acts establishing the six agencies being superintended by the Ministry of Aviation. The agencies include, The Nigerian Civil Aviation Authority (NCAA), Federal Airports Authority of Nigeria (FAAN), and the Nigerian Airspace Management Agency (NAMA). Others are the Nigerian College of Aviation Technology (NCAT) Zaria, Air Accident Investigation Bureau (AIB), and Nigerian Meteorological Agency (NIMET).

Aviation analyst, Ifeanyi Ogochukwu, said strengthening the NCAA economic regulation is important to the growth of the local sector.

Ogochukwu, a licensed Air Traffic Safety Electronics specialist, told journalists the regulatory agency should be empowered to effectively carry out oversight functions of the entire industry, most importantly the charter operators.

He warned that any attempt to weaken the power of the regulatory agency might spell doom for the industry, adding that aviation is internationally-regulated, with standards.

“NCAA should have more powers to regulate charter services in the Act. A lot of people in government are using charter services to do some shady businesses in the industry. The NCAA should have the regulatory authority to effectively regulate the charter services.

“NCAA should be empowered to carry our economic regulation of the agencies apart from the airlines, ground handlers and other organisations in the sector. The NCAA is not really enforcing compliance in these agencies, but the new bill before the National Assembly should address this.

“An aspect of the Act should say that ‘In case of political interference and anything happens, the minister will be held liable.’ It should be there by law. Once this is done, it will be absolutely impossible for the minister to interfere because he knows once he does that, it is a criminal offence and can be held liable,” Ogochukwu said.

Director, Centre for International Advanced and Professional Studies (CIAPS), Prof. Anthony Kila, said the NCAA is a critical agency in the sector and should be empowered to discharge its duties without interference.

Kila sought a new NCAA that is customer-centric, flexible and one that works in harmony with airlines and other organisations in the sector.

He said: â€œFor the economic regulation, the essence of this is to make sure that customers are not stranded, no matter who runs the airlines. The reason they should be sound economically and safe technically is to make sure our sky is safe. Therefore, a good economic regulation should not be the one that will make life unnecessarily difficult, but work with them to ensure that it is sustained. That means you have to look at the cost of insurance for airlines, regime of paying for landing and parking for airlines.

“Overall, the new NCAA should be passenger-centric. If anyone can understand that the reason they are on that table is to discuss, deliberate and consult to make life easier, safer and more reliable for the passengers. That is the way we can get there.”

Like Ogochukwu, he canvassed for the retention of the five per cent TSC/CSC for the agency and others in the sector, stressing that they required revenues to sustain safety in the system.

He explained that most of the NCAA charges are recognised internationally, noting that rather than reducing the powers of the regulatory body, its powers should be strengthened to boost safety.

“Government needs revenues to sustain itself. We should understand that nobody pays happily, but it is a necessity to pay those charges. Don’t forget that our industry is an international sector that the fees are not just made locally, but they have to reflect globally. When you look at what happens around the world, you should also look at the cost of operations for the airlines so that we don’t end up comparing Nigeria with Saudi Arabia.”

OCTOBER 14, 2020

• Local airlines acquires ERJ-145 aircraft 

The International Air Transport Association (IATA) has demonstrated the low incidence of in-flight COVID-19 transmission with an updated tally of published cases.

Since the start of 2020, there have been 44 cases of COVID-19 reported in which transmission is thought to have been associated with a flight, inclusive of confirmed, probable and potential cases. Over the same period some 1.2 billion passengers have travelled.

Meanwhile, a local carrier, Air Peace, has taken delivery of a new ERJ-145 aircraft to help boost its domestic and regional operations. The aircraft, with registration number 5N-BXF, arrived at the Murtala Muhammed International Airport, Lagos, at the weekend.

IATA’s Medical Advisor, Dr. David Powell, said the risk of a passenger contracting COVID-19 while onboard appears very low.

“With only 44 identified potential cases of flight-related transmission among 1.2 billion travellers, that’s one case for every 27 million travellers. We recognise that this may be an underestimate, but even if 90 per cent of the cases were un-reported, it would be one case for every 2.7 million travellers.

“We think these figures are extremely reassuring.  Furthermore, the vast majority of published cases occurred before the wearing of face coverings in-flight became widespread,” Powell said.

New insight into why the numbers are so low has come from the joint publication by Airbus, Boeing, and Embraer of separate computational fluid dynamics (CFD) research conducted by each manufacturer in their aircraft.

While methodologies differed slightly, each detailed simulation confirmed that aircraft airflow systems did control the movement of particles in the cabin, limiting the spread of viruses. Data from the simulations yielded similar results.

Aircraft airflow systems, high efficiency particulate air (HEPA) filters, the natural barrier of the seatback, the downward flow of air, and high rates of air exchange efficiently reduce the risk of disease transmission on board in normal times.

The addition of mask-wearing amid pandemic concerns adds a further and significant extra layer of protection, which makes being seated in close proximity in an aircraft cabin safer than most other indoor environments.

IATA’s data collection and the results of the separate simulations, align with the low numbers reported in a recently-published peer-reviewed study by Freedman and Wilder-Smith in the Journal of Travel Medicine.

Although there is no way to establish an exact tally of possible flight-associated cases, IATA’s outreach to airlines and public health authorities combined with a thorough review of available literature has not yielded any indication that onboard transmission is in any way common or widespread. Further, the Freedman/Wilder-Smith study points to the efficacy of mask-wearing in further reducing risk.

Mask-wearing on board was recommended by IATA in June and is a common requirement on most airlines since the subsequent publication and implementation of the Takeoff Guidance by the International Civil Aviation Organization (ICAO). This guidance adds multiple layers of protection on top of the airflow systems which already ensure a safe cabin environment with very low risks of in-flight transmission of disease.

“ICAO’s comprehensive guidance for safe air travel amid the COVID-19 crisis relies on multiple layers of protection, which involve the airports as well as the aircraft. Mask-wearing is one of the most visible. But managed queuing, contactless processing, reduced movement in the cabin, and simplified onboard services are among the multiple measures the aviation industry is taking to keep flying safe.

“And this is on top of the fact that airflow systems are designed to avoid the spread of disease with high air flow rates and air exchange rates, and highly effective filtration of any recycled air,” Powell said.

Meanwhile, Spokesperson for Air Peace, Stanley Olisa, said the new arrival is a 50-seater aircraft, and the eighth of the model type.

Olisa reiterated the airline’s commitment to ease the burden of travel in Nigeria and beyond.

“Air Peace now boasts of 26 aircraft in its fleet. We’re also gearing up to receive two brand new 124-seat capacity Embraer 195-E2 Jets this October, the first set of the 13 we had ordered, with purchase rights for 17 more,” he said.

Olisa, who affirmed Air Peace’s ambition to interconnect various cities in Nigeria, added that the flying public should expect more domestic and international routes to be launched, like Johannesburg, London, Houston, Guangzhou, Mumbai, and other planned destinations.

OCTOBER 14, 2020

BY  Okechukwu Nnodim, Abuja

The Federal Government on Tuesday declared that it would double the number of airports across Nigeria by 2023.

Nigeria has about 31 airports currently. The Federal Airports Authority of Nigeria operates 26 of the facilities, while others are largely run by states.

Responding to a question on airports which the government intends to develop in 2021 as captured in the budget of the Federal Ministry of Aviation, the Minister of Aviation, Hadi Sirika, said a lot of work would be done across airports in Nigeria.

He disclosed this at the Abuja headquarters of the Federal Ministry of Finance during the presentation of the 2021 budget.

Sirika said, “Since this administration came in, we drew our roadmap in trying to improve on civil aviation and transportation in general. We understood the importance of air connectivity.

“So we believe investment in this sector will do very well for our economy. Before the end of 2023, we would have doubled the number of airports in Nigeria.”

He added, “We have a saying that one-mile-long road leads to nowhere, but one-mile-long runway leads to everywhere.

“We understand the importance of aviation infrastructure as a critical component for the working of our economy and they are also national security assets.”

The minister said airports were being built in various locations in Nigeria and that more were in the works.

“So, all over the place, airports are being built in Nigeria which is a sign of growth for us,” Sirika added.

OCTOBER 14, 2020

Civil society groups want the National Assembly to reject the proposal

By  Bassey Udo

Despite the lockdown of most countries’ economies as a result of the ravaging impact of the coronavirus pandemic, the Nigerian government is still making big plans to fund Nigerians wishing to travel to Saudi Arabia and Israel to perform their traditional religious tourism.

Civil society groups have fiercely kicked against the proposal contained in the 2021 budget published on the website of the Budget Office of the Federation.

In the proposal, the government said it has set aside a total of N2.6billion it plans to spend on the programmes and activities of the National Hajj Commission of Nigeria and the Nigerian Christian Pilgrim Commission for the year.

The two agencies are responsible for the religious interests of the Muslims and Christians, including the facilitation of annual pilgrimages by adherents of the two religions to Mecca and Jerusalem respectively.

Although Nigerians have repeatedly condemned the continued use of public funds by the government to finance what they consider a purely private affair, successive administrations have continued to make provisions in their annual budgets.

However, concerned civil society groups have asked the National Assembly to demonstrate patriotism and refuse to approve such proposals in the 2021 Budget, in view of the need by the government to conserve funds to finance more pressing public needs.

“With shrinking revenues to meet priority programmes and activities, the government must cut down drastically on identified areas of wastage and frivolities in the system. One area of such needless wastage is using public funds to finance strictly private religious activities,” Raphael Uchenna, an Abuja based legal practitioner, told PREMIUM TIMES on Wednesday.

The ravages of COVID-19

The initial wave of the Coronavirus pandemic, which has so far recorded over 37.7 million cases and claimed over 1,078,860 lives around the world, according to statistics by the Johns Hopkins University, forced most countries to close their borders, to discourage visitors coming to their countries for businesses and other interests.

The decision to lockdown has been identified by experts as one of the practical ways to check the spread of the disease.

Although most countries are struggling to come to terms with the new reality of having to be bound within their borders, others are cautiously reopening their doors, amid fears of being hit by another wave of the pandemic, which many predict, could be more horrific than the first.

Nigeria has so far recorded about 60,430 cases, out of which 1,115 victims have died, with 51,943 recoveries as of Monday, October 12, according to the Nigeria Centre for Disease Control (NCDC).

Budgetary provisions

Regardless, the Nigerian government appears to care less about any consequence of the impact of the pandemic on its citizens, as it is already planning for the post-pandemic years with plans in the 2021 budget to fund the travel by both Muslim and Christian faithful during the year.

While the National Hajj Commission of Nigeria was allocated about N1.39billion, its Nigerian Christian Pilgrim Commission was allocated about N1.38billion.

Apart from overhead costs totalling over N617.4million, the National Hajj Commission is to spend a total of N130 million on general travels and transportation, including N20 million for local travel and transport for training, in addition to N50million for other similar trips during the year.

Besides, about N10 million has been set aside for international travels and transport for training and N50 million for other overseas travels and transport during the year.

Other allocations for the Commission are N25million for consulting and professional services, in addition to N15 million for financial consulting, apart from another N25.4million for general financial charges, including insurance premium.

About N10 million has been budgeted for refreshment and meals for the Commission; N15 million for honorarium and sitting allowances; publicity and advertisements (N20 million); welfare packages N70 million; monitoring activities and follow-up (N30 million).

Although the Nigeria Christian Pilgrims Commission does not have a provision in the budget for foreign travels and transport, about N71.3million has been budgeted for allowances and social contributions during the year, while overhead costs, including general local travel and transport, would gulp N586.5million.

Also, the Commission plans to spend about N42.3million on general furniture, building and residential quarters and equipment maintenance; N25.1million for training as well as N181.6million for other services, like consulting and general professional services.

Civil society groups kick

Civil society and accountability groups are seriously concerned that the government appears not to have come to terms with the reality of the COVID-19 times, as its officials are still indulging in frivolities that appear not to have any bearing on attempts to find solutions to the country’s problems.

With the economy seriously constrained by the challenge of low revenues to tackle acute national problems as a result of the impact of the ravaging coronavirus, the groups say the allocation of funds to programmes and activities that could best be handled as private issues shows the government was yet to learn from its past mistakes.

The allocation of funds to the two agencies, whose activities critics say should not be funded with public funds, shows our government does not learn, or ready to listen to public views on how to get out of economic quagmire the country has found itself.

“The country is currently facing many problems on several fronts as a result of lack of funds. Apart from schools that have not opened, because there is no money to pay lecturers, Nigerians are angry, because fuel price and electricity tariffs have all increased, and there is no money to fix our refineries and electricity generation and distribution infrastructure.

“Yet, the government is proposing to fund the activities of agencies that should have been scrapped long ago. Matters of religion are strictly personal affairs. If anybody wants to go to heaven, the person should bear the cost from private resources,” the Lead Director, Centre for Social Justice, Eze Onyekpere, said.

“What I see is that as far as the government is concerned, COVID-19 will soon be over next year for life to continue as usual. It does not matter to them if the lecturers are not paid and schools remain closed,” he added.

For Joshua Olufemi, the Founder and Chief Executive Officer of Dataphyte Nigeria Limited, an Abuja-based media research and data analytics firm that specialises in deploying data tools and technology towards socio-economic development and social impact, with the low revenue challenge the government is currently grappling with, the allocation of N2.6billion in the 2021 Budget could have solved better problems in the economy than personal religious tourism.

How N2.6 billion could best be utilised

With the country still struggling with the dearth of basic infrastructures in all areas of our national economy, Mr Olufemi said if the government were to have decided to focus on infrastructural development, the allocation of N2.6billion in the 2021 Budget could constructed and equipped at least 260 classroom blocks to secondary schools across the country with N10million shared to each of the benefitting schools.

If the government’s priority were to shift to poverty alleviation through social intervention schemes like soft loans to micro, small and medium-scale enterprises to impact the businesses of the less privileged Nigerians, the economies of no fewer than 2,600 Nigerians would be positively impacted and enhanced a grant of N1million as interest-free loans to some qualified Nigerians.

With such intervention, he said the huge population of Nigerians currently without jobs would have been reduced by about 2,600.

Again, with the government in dire need of adequate healthcare services due to lack of primary health centres in the rural areas, the allocation of N30 million in the 2021 Budget for the construction of health centres would have fetched a total of 87 such facilities, with two distributed to each of the 36 States of the Federation and the Federal Capital Territory, and 13 left to spare for the most vulnerable.

Similarly, if the government interest was on the provision of boreholes for the provision of a source of potable water supply in locations in each of the 774 Local Government Areas of the country, an allocation of N600,000 from the money would provide a total of 4,333 boreholes, or five boreholes each, with about 463 others left to spare.

Besides, if the target is to provide low-cost housing or mortgage to the people, with an average of N15 million allocated in the budget for that purpose, at least 173 decent and affordable houses would be constructed for the benefit of some Nigerians next year.

“Sadly, these are not our governments’ priorities. Their priorities are how to provide funding for activities that are clear may not be realised, in the face of the damning reality posed by the COVID-19 pandemic, which has limited the chances of people traveling out of the country for any meaningful activity, least alone religious tourism,” Mr Olufemi lamented.

OCTOBER 15, 2020

WestJet is suspending operations to four cities and significantly reducing service to two other cities in Atlantic Canada, as the airline continues to grapple with “obliterated” demand as a result of the COVID-19 pandemic.

The Calgary-based airline said Wednesday all flights to and from Moncton and Fredericton, N.B., Sydney, N.S. and Charlottetown, P.E.I. will be discontinued as of November 2 while service will be significantly reduced to Halifax, N.S. and St. John’s, Nfld.

The decision will eliminate 100 weekly flights to and from the Atlantic region, or nearly 80 per cent of seat capacity. An additional 100 employees who were scheduled to return to work next month will be laid off.

"It has become unviable to serve these markets and these decisions were regrettably inevitable as demand is being obliterated by the Atlantic bubble and third-party fee increases," WestJet chief executive Ed Sims said in a statement.

"Since the pandemic's beginning, we have worked to keep essential air service to all of our domestic airports, but we are out of runway and have been forced to suspend service in the region without sector-specific support."

The suspended routes include flights between Toronto-Moncton, Toronto-Fredericton, Toronto-Charlottetown, Toronto-St. John’s, Halifax-Ottawa and Halifax-Sydney. The move will leave Atlantic Canada with three WestJet routes, including Halifax and Toronto (14 weekly flights), Halifax and Calgary (nine weekly flights) and St. John’s and Halifax (11 weekly flights).

The COVID-19 pandemic, as well as related government-imposed travel restrictions, have devastated demand for air travel around the world. Anyone travelling to Atlantic Canada is required to quarantine for 14-days, but residents living in the so-called Atlantic bubble are allowed to travel within the four provinces without quarantining.

“The lack of travel demand combined with domestic quarantines means that, sadly, we can no longer maintain our full Canadian network of service,” Sims said in a video announcing the route suspensions.

“It has taken decades to build this robust Canadian network to its highly competitive position. Over the last eight months, we are beginning to see these efforts unravel.”

Prior to the pandemic, WestJet flew more than two million passengers per month. Since March, the company has flown approximately one million passengers in total. The airline has parked 70 per cent of its fleet and laid off thousands of employees.

Sims said the demand issues have been exacerbated by rising fees at five airports in Atlantic Canada. WestJet increased fees it charges domestic travellers in September by 30 per cent, or between $4 and $7 per flight, citing a rate increase imposed by Nav Canada, the federal organization that operates air traffic control operations.

“Price increases that make air travel even more expensive are not what the travelling public needs or can even afford right now,” Sims said.

Air Canada announced in June that it would suspend 30 domestic routes and close operations at eight regional airports across the country, including two in Atlantic Canada. Nearly half of those suspended routes serviced Atlantic provinces.

Alicja Siekierska is a senior reporter at Yahoo Finance Canada. Follow her on Twitter @alicjawithaj.