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More than $28 million paid to Skyport under airport deal

LF Wade International Airport (Photograph by Akil Simmos)

Skyport was paid almost $7.6 million this week as part of the latest payout over the airport’s minimum revenue guarantee.

Lawrence Scott, the Minister of Transport, told MPs that the Bermuda Airport Authority had now made four payments to the developer under the MRG totalling $32.8 million – but a $4.2 million reimbursement for overpayment was received last year.

Net payments to Skyport under the MRG have now reached $28,577,460.44.

Mr Scott said that on July 9, Skyport provided notice that airport revenues fell $7,579,778.10 below the guaranteed level for the period between April 1 and June 30, and that the sum had been paid this week.

He added: “We expect to make additional MRG payments in 2021, however, we do not have estimated amounts at this time.

“The Bermuda Airport Authority continues to do an excellent job in managing this complex matter as part of its oversight responsibilities.

“The Bermuda Airport Authority has met, and continues to meet, all of its contractual obligations relating to the MRG payments.”

Mr Scott said international bodies have suggested that international air travel will not reach pre-pandemic numbers until 2024, and it was likely the payments to Skyport would continue until then.

But he added the Ministry and partners were working to bolster travel figures to help reduce payments under the MRG.

“The MRGs are based on departures, not necessarily arrivals, so the ministry is looking to go to locally-based and locally inspired routes such as Azores and the Caribbean,” he said.

“We are also looking at West Africa – which is part of the African diaspora trail – and points in Western Canada, which will provide connectivity onward to the Philippines and India.

“Given that those routes are locally driven, we will have persons that are departing the island, but also those persons will be inviting what we call VFR – visiting friends and relatives.”

He said service between Bermuda and the Azores, which launched earlier this summer, had proven successful and had been extended beyond its original end date.

Mr Scott added that said Air Canada flights to the island are expected to resume soon and service to both the US and the UK were expected to continue to grow.

TravelWeek has reported that Air Canada service between Toronto and Bermuda would resume on August 6, with flights running on Fridays and Saturdays.

He said the airport authority was also looking for additional revenue sources, such as expanding Bermuda’s airspace to provide additional air navigation services revenue.

“Every time an aircraft flies through that extended airspace, we would be paid by the airline,” Mr Scott said.

“For the first two weeks of July, we have had close to 800 flights fly through our airspace, versus the roughly 40 flights that have actually landed at our airport.”

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Published July 24, 2021 at 7:53 am (Updated July 24, 2021 at 7:53 am)

More than $28 million paid to Skyport under airport deal

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