Oman's plan to launch new low-cost airline under assessment: CAA

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Oman is planning to launch a new low-cost airline and interested companies have time till the first week of August to express their interest in obtaining operating licence from the Sultanate of Oman.

Apart from plans for developing six new airports, the Civil Aviation Authority (CAA) also seeks to encourage more airlines to operate from the country in the future.

Speaking to the Observer, Eng Nayef bin Ali al Abri, Chairman of Civil Aviation Authority (CAA), said, "What was announced is an an Expression of Interest (EoI) and we are waiting for feedback from the interested parties. We will then assess the appetite of the sector and decide accordingly on the next step. Interested parties have time until August 5 to respond."

Al Abri added that the the civil aviation sector in the country in general is a safe place for investment and this will be actively promoted to attract more airlines to the country.

According to market sources, EoI is an initial step in the tendering process by organisations to survey the market. It is a pre-tender document to screen potential bidders. It may noted that the CAA announced its intention to license a new low-cost airline, which created a buzz as the Sultanate of Oman already has a budget airline, which started in 2017, while the national airline, Oman Air, has been undergoing a restructuring programme.

The Ministry of Heritage and Tourism, too, recently acknowledged that much more is needed to provide connectivity to tourists wishing to come to the Sultanate of Oman directly from their countries.

For Middle East airlines, the demand for travel remains buoyant and looks set to continue apace. The Gulf carriers are relatively less impacted by the geopolitical risks, according the IATA forecast for this year. In the post-pandemic period, there has been an increase of 35 per cent in aircraft movement between 2022 and 2023 and a 47-per cent increase in passenger traffic at Muscat International Airport.

The CAA has been optimistic about the scope for growth for the aviation sector in the Sultanate of Oman, which will have six new airports, and most of them are expected to be operational by 2028-2029.

With work underway on the design of new projects, the number of airports in the country will go up to 13, which will boost both domestic aviation and tourism. The number of passengers using airports in the Sultanate of Oman will go up to 50 million by 2040 from the current figures of 17 million, according to CAA.

The CEO of Oman Air, Con Korfiatis, recently told the Observer that the airline is committed to total transformation by 2027, which he considered a fair time to turn around the financials and lay the foundation for growth.