The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The government must change the Airport Authority Act to facilitate its acquisition of Grand Bahama International Airport, a Cabinet minister has revealed, adding that a deal “is so close I can feel it”.

Dionisio D’Aguilar, minister of tourism and aviation, told Tribune Business that the “location specific” nature of the Act requires it to be amended so that Grand Bahama’s primary gateway can legally be brought under its ownership authority and control.

“We’ve finished the negotiations; we now have to go through the mechanics of getting it done,” he disclosed. “We have an agreement, but the mechanics of the details are in the process of being completed and worked out.

“We have to change the law, the Airport Authority Act, to enable it to acquire that airport because that Act is location specific. It refers to specific locations, so we have to amend that Act to acquire the airport.”

Mr D’Aguilar declined to discuss the terms of the acquisition deal between the Government and the airport’s owners, Hutchison Whampoa and the Grand Bahama Port Authority’s (GBPA) Port Group Ltd, although this newspaper previously reported that the purchase price was $1.

In return, Hutchison and the GBPA will hand over responsibility for rebuilding and redeveloping the facility to the government while also retaining the Hurricane Dorian insurance proceeds.

Mr D’Aguilar said the two sides were now preparing legal documents and going through “the mechanics of transferring title”, adding that “tens of millions of dollars, possibly hundreds of millions of dollars” will be required to rebuild Grand Bahama International Airport as a critical piece in the country’s national infrastructure.

“The only thing we have to consider is that it would be madness to rebuild that airport using the same approach we’ve done in the past because every time we get a storm surge it wipes it out,” he told this newspaper. “It makes absolutely no sense to put the airport back the way it’s been done in the past.”

Dr Hubert Minnis yesterday said the Cabinet will likely discuss the Grand Bahama International Airport purchase this coming Tuesday. “My understanding is that all the paperwork is all completed and that will be brought to Cabinet on Tuesday, at which time Cabinet will deliberate on it,” he added.

“We are prepared at this time to take over and move the management team in place. Once the management is in place, then we will take over.”

Many observers believe that Hutchison and the GBPA, which own the airport 50/50 via the Freeport Harbour Company with the Hong Kong conglomerate holding management control, walked away from their obligations to rebuild the Dorian-ravaged facility in the storm’s aftermath.

Reconstruction costs have been estimated at $60m to reconfigure the airport and harden it against future storms. With the Public Treasury increasingly cash-strapped due to COVID-19, the Government is looking to a private-public partnership (PPP) to raise the necessary financing and construction/management expertise similar to the Nassau Airport Development Company (NAD) model.

Magnus Alnebeck, Pelican Bay’s general manager, while hailing announcements that an acquisition is close as “fantastic news” this week warned the Government that it must tackle Grand Bahama International Airport’s (GBIA) high costs if its prospective purchase is to “grow the destination”.

The resort executive said it was vital that such a key infrastructure asset, which acts as the tourism and commercial gateway to Grand Bahama, be owned by a proprietor that wanted to expand the island’s economy rather than an entity seeking to extract as much profit as possible from a diminishing customer base.

Arguing that the present ownership duo fell into the latter category, Mr Alnebeck said the airport “has to be better” than its post-Hurricane Dorian appearance of “a tin and some rusty chairs”. He added that airline connectivity at competitive costs and fuel prices was more important for the island’s revival as a tourism economy.

The present airlift situation, with the island being served by minimal carriers and flights, was described as unsustainable especially since ticket prices were more expensive between Miami and Freeport than those for the Nassau route.

“There has been the challenge with the operating costs at the airport that are generally passed on to airlines and passengers, and make it too expensive that no one wants to fly there,” Mr Alnebeck added.

“If this purchase happens it will be fantastic news, and then I hope they [government] find a solution as to who operates the airport as opposed to messing with the airport themselves. It’s a wonderful idea that the people of The Bahamas own the airport as opposed to a private company that wants to make money out of it.”