National flag carrier Garuda Indonesia plans to open eight new short-haul domestic flight routes from Pondok Cabe Airport in South Tangerang, Banten, in July next year.

The airline signed a heads of agreement (HoA) with state energy company Pertamina to use the latter'€™s Pondok Cabe Airport for the new routes on Monday.

The new routes will fly from the suburb to Cilacap and Semarang in Central Java; Yogyakarta; Bandar Lampung; Lubuk Linggau and Palembang in South Sumatra; Ketapang in West Kalimantan; and Pangkalan Bun in Central Kalimantan.

'€œThis joint cooperation is great news for our business expansion, especially in under-served areas,'€ Garuda Indonesia president director Arif Wibowo said after the signing ceremony in Central Jakarta on Monday, which was witnessed by State-Owned Enterprises Minister Rini Soemarno.

The distances from Pondok Cabe to the eight cities vary from 460 kilometers to 1,400 km, with flight times between one and two hours.

The routes will be served by the short-haul ATR 72-600 airliner. '€œWe have 11 of them and will add nine more next year,'€ Arif said.

Garuda plans to operate at least 25 flights a day from the airport, with an at least 70-seat capacity per aircraft and ticket price of around Rp 1 million (US$73). The airline is expecting an additional 638,750 passengers per year and Rp 638 billion in additional revenue.

The Soekarno-Hatta International airport in Greater Jakarta, the country'€™s main gateway, is congested with over a thousand flights per day. The Halim Perdanakusuma has begun serving commercial flights from early 2014 to reduce the congestion.

Pertamina president director Dwi Soetjipto said that the cooperation between the two firms was in the form of space rental, with the oil and gas giant expecting to earn Rp 40 billion to Rp 50 billion annually.

To prepare the airport for next year'€™s launch, Pertamina has allocated Rp 200 billion for the first stage revamp, including runway strengthening and terminal renovation. It is also in the process of obtaining a license from the Transportation Ministry to operate Pondok Cabe commercial airport.

Pondok Cabe Airport is now a shared civilian and military airport. Pertamina uses it as the base of its commercial charter airline, Pelita Air Service, while the Air Force uses it for various purposes.

According to Dwi, the 110-hectare airport is equipped with 2,200 meters of runway. '€œThe length is enough for our operations; we just need to overlay it to ensure it'€™s hard enough. We are also renovating the terminal,'€ he told reporters.

Garuda aims for overlay, terminal renovation and permit issuance to conclude by February or March next year and for the airport to start operating commercially by July.

Garuda is upbeat that the new routes will attract passengers from residents of the areas around the airport, despite the absence of any toll road connecting the area to the city center.

The airport is located 23 kilometers from Jakarta, a one-hour drive in good traffic, partly on normal and partly on toll roads.

'€œWe believe that the current infrastructure is enough. We are targeting denizens of Pondok Cabe in South Tangerang and South Jakarta as our potential buyers,'€ Arif said.

In the next revamp stage, Pertamina plans to lengthen the runway over adjacent golf courses and connect the airport to a new highway linked to the existing Jakarta Outer Ring Road.

Minister Rini, who was present at the signing of the agreement, said that she appreciated the cooperation between the two companies.

'€œIn order to become stronger, state enterprises should share their competitive advantages to enhance marketing and operations,'€ she said. (rbk)

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