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UPDATE: Kangaroo Island Airport upgrade

 

 

Plans for the Kangaroo Island Airport upgrade are well underway. The Chief Executive Officer of the Kangaroo Island Council – Andrew Boardman – has supplied this exclusive update for Business Kangaroo Island members.

 

In 2015, the Council was successful in putting together a State Government supported bid, worth a combined $18 million, to the Commonwealth Regional Infrastructure Fund - National Stronger Regions.  The award was announced by the Commonwealth in December and, with the funding agreement in place by late February, we have been able to proceed with the design phase of the project. Work continues with the State via the Department of Planning, Transport & Infrastructure (DPTI) to progress through the State Government funding processes in order to secure a formal funding agreement for its 50 per cent contribution. This is likely to be completed in late May or early June.

 

The tenders for design were put to market and generated enormous interest. The Consultants - all South Australian companies - engaged are:

 

Package A – Airside: Tonkin Consulting and Aerodrome Design.

 

Package B – Terminal: Ashley Halliday & Assoc – Architectural Services; Wallbridge & Gilbert – Civil Engineering; Bestec – Combined Services.

 

Project Services: RCP – Project Managers; Cundall – Environmentally Sensitive Design; RLB – Quantity Surveying / Cost Management.

 

The project is in design now with a clear brief to the Team to optimise use of local and South Australian materials and skill sets, to ensure that the Island and the State benefit as much as possible from the investment. We hosted the first commercial-user stakeholder meeting with the architects in late April and this has allowed further fine-tuning of the design.

 

We will have our first value management meeting in mid-May with a view to proceeding to final design and documentation between then and the end of June. The procurement strategy will be responsive to design and we expect to confirm this over the course of the next six weeks. We expect to go to market for construction in July, with evaluation and award in August and an expected construction start in mid-late September. It is anticipated that airside work will be completed by end of May 2017 and Terminal completion by August 2017.

 

With the upgrade clearly aimed at establishing east coast direct services to Melbourne and Sydney, the Council needs to be able to deliver a fit-for-purpose facility capable of handling the simultaneous arrival and departure of 100-seat regional jets together with 35-seat regional turbo-prop aircraft and the associated security needs of the larger interstate aircraft. It is also important that the Airport is an entrance statement for the Island; first impressions count and it is essential that the Airport and its operation are aligned to the environment they serve.

 

The Council has been working closely with the Commissioner for Kangaroo Island, Wendy Campana, to ensure that as many local businesses as possible – both in construction and services – are airport ready and it is pleasing to see the number of business that have come forward to work with the Commissioner to improve their competitiveness in the open market procurement processes that a project like this will demand.

 

The $18 million Airport Project does not require Council funding other than a minor purchase of 7.8 ha of additional land to the southern end of the runway. Works carried out to date were funded through financial assistance from the Kangaroo Island Futures Authority and there will be no impact on the 2016-17 draft budget. The Council, working with its auditor, Deloitte, has been able to establish an appropriate means of grant recognition across the life of the asset which minimises the impact of the depreciation provisions associated with the investment and will ensure that the airport will be cash-flow positive from day one.

 

Discussions with airlines have started with the Council, specialist Aviation Consultants and SA Tourism Commission working collaboratively to build and deliver a pitch to the airlines. Meetings to date have been productive. It is anticipated the process of negotiation will take three to six months to complete and we would hope that we will be able to have a clear nine-month minimum from commitment to date of first new service, in order to be able to start building interest and sales. The Council and the Commissioner will also work with Island Producers to support them to start market development activities for their high-value, short-shelf-life Island produce that can be air-freighted into east coast markets and international gateways.

 

This is an exciting project and one that is a game-changer for the Island – addressing one of the access paradigms that challenge the Community and those time-poor visitors who are simply not coming to the Island at this time. The market research carried out by the Council as part of the business case clearly demonstrates the untapped potential of the domestic market; the ability to effectively participate in the boom in visitation to Australia from the new markets in Asia and India and also the ability to better serve our traditional Northern European and US markets. Extremely encouraging comment from international travel wholesalers leads us to expect that response to direct flights could be even stronger than predicted.

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