OSLO, NORWAY: Avinor has decided to postpone the decision on whether to build a new airport in Bodø by 12 months. This means that the new airport could be commissioned in the second half of 2029. The project cost is NOK 6.6 billion.
“The new Bodø airport is very important to Avinor, the defence sector and the local community. There is a strong desire to see the project through. However, while on our way towards that goal we have seen the conditions relating to Avinor’s participation change. After almost two years of the pandemic, Avinor faces a serious financial situation and there remains continued and significant economic uncertainty going forward. It is not advisable to take up the risks that making a decision to pursue this project would include at this point in time,” says Abraham Foss, CEO of Avinor.
Originally, Avinor’s contribution was estimated at NOK 1.8 billion. The financing solution as set out in the 2022 Norwegian government budget means that Avinor’s share has increased to NOK 2.2 billion. Furthermore, Avinor must cover standard project risk up to a value of NOK 1.0 billion. This is a significant increase in financial risk for Avinor when compared to the original costing assumptions.
“Avinor is responsible for ensuring the operation of safe aviation services throughout Norway, and we have a number of projects that we must carry out over the years to come. Avinor needs to bring more clarity to its long-term financial situation before a decision can be made about the new Bodø airport project.
We now have an equity ratio that is lower than that prescribed by our articles of association. The reasoning behind our decision to postpone lie in an evaluation of the project’s scale, the responsibility Avinor has for the aviation infrastructure nationwide, and the critical financial situation that the company finds itself in,” says Foss.
Uncertain future for the aviation sector
How the aviation sector will develop in the years to come continues to be highly uncertain. A postponement of the project will provide an opportunity to strengthen the project and reduce the associated risks by confirming the project framework. The project planning will continue throughout the year during 2022 but at a reduced pace.
“We realise that this is not good news, especially for Bodø city council whom we have worked closely together with to realise the relocation of the airport. We recognise that the council is dependent on predictability around a project that is crucial to the development of the city. Avinor will continue its strong collaboration with Bodø city council and we note there is a strong political will to get the project completed. At Avinor, we are positive in respect to this project and want it to see it completed,” says Foss.
