July 24, (THEWILL) – The closure of the domestic runway (18L) of Murtala Muhammed Airport (MMA) by the Federal Airports Authority of Nigeria (FAAN) has further compounded the challenges facing domestic airlines in the country.
In a Notice To Air Men (NOTAM) of July 5, 2022, FAAN announced the closure of the main domestic runway for a period of 90 days, beginning from July 8, 2022.
It is estimated that the closure automatically adds 10-15 per cent fuel costs per sector to and out of the domestic airport in Lagos, based on the additional flight and taxi time incurred as a result.
Before the closure, the operators were grappling with the JetA1 crisis, which began in late February and deteriorated further through the months of March and May to date.
The runway closure is said to be currently threatening the ability of airlines to continue operations.
The price of JetA1 rose suddenly from N200 in December 2021 to over N400 per litre in February. Today the price has skyrocketed to over N800 per litre.
In addition to the continuous rise in the price of aviation fuel, supply is at best epileptic and unpredictable at several airports across the country, thereby causing flight delays, even cancellations, as airlines queue for fuel at airports across the country.
Added to the already difficult situation, is the high cost and scarcity of foreign exchange. As a result, the oldest airline in the country, Aero Contractors, recently shut down its scheduled passenger service operations with effect from Wednesday 20th July.
The airline cited the impact of the challenges in the operating environment on its daily operations as reasons for the action. Two days after, NCAA also suspended Dana Airlines’ Air Transport Licence (ATL) and Air Operator Certificate (AOC) indefinitely, with effect from midnight of Wednesday, July 20, 2022.
The closure of operations by both Aero and Dana brings the number of functional domestic airlines operating scheduled passengers flight services from a meagre 9 operators to 7.
Although stakeholders are worried that if nothing is done to address the reasons given for the suspension, more airlines may still fall victim.
They warned that with the reduction of available operators, the issue of flight delays, cancellation and fare hike collusion may rear its ugly head.
An airline Operator, Mr. Femi Adeniji, suggested the areas that government can assist the airlines to remain in business in these challenging times.
“Extend benefits through tax credit, through grant, is not until we start having duty free for parts, fuel cost, tax credit, I think that is the only way out,” he said.
The President, Association of Foreign Airlines and Representatives in Nigeria (AFARN), Mr Kingsley Nwokoma, stated that the development is unfortunate, adding that this would further disrupt passenger facilitation currently being experienced due to high cost of aviation fuel and its scarcity.
He said, “It is really disturbing. In the past few months everybody knows it has been very challenging in the aviation industry in Nigeria, high cost of fuel.”
Another airline operator, Captain Ibrahim Mshelia, had earlier warned that some airlines may also suspend operations due to the closure of the domestic airport runway in Lagos for maintenance as most airlines cannot afford the daily wastages of taxing and holding for three months.
To strike a balance, the President of the Aviation Safety Round Table Initiative (ASRTI), Dr Gabriel Olowo, advised airlines to sell what they buy, following the galloping prices of Jet A1. This is just as he called for increased vigilance of the Nigerian Civil Aviation Authority (NCAA), stressing that a price increase is better than negotiating safety by cutting corners.
Olowo, in his communication titled, ‘Sell what you buy’ advised that given the circumstances beyond the control of the aviation sector, airlines should factor in their extra costs.
Stressing that prices would increase, but beat the alternative of cutting corners,
he said, “This is my candid opinion to airlines. Given these uncontrollable factors of production in the sector, demand will definitely drop but it will be much better than cut corners and plan an accident.
“If a trip’s fuel is 4,000 litres for one hour on jet (LOS-ABV), for example, at N800 per litre, which gives N3.2million and a load factor of 100 passengers, this means that fuel cost per passenger is N32,000 and this is approximately 30 per cent of the total cost.
“This will translate to N107, 000 tariff for a one-way journey QED.
“PHCN has introduced Premium Tariff on power and those who can afford it are settling for it. This is not the time for frivolous and reckless competition nor uneconomic patriotism. Operators should intensify cooperation, collaboration, consolidation and prune schedules to minimise perishable seats and maximise load factor”.
Meanwhile, FAAN had been on top of the ongoing work on Runway 18L/36R, which commenced on July 8, 2022 with mobilisation of equipment and workers.
About the Author
Anthony Awunor, is a business correspondent who holds a Bachelor of Arts Degree in Linguistics (UNILAG). He is also an alumnus of the Nigerian College of Aviation Technology (NCAT), Zaria Kaduna State. He lives in Lagos.
