Red tape and economic slump mean fewer business travellers for fledgling air route

By DAVID MURPHY

Air Greenland’s recently re-established Iqaluit-to-Nuuk air route seems to have increased the number of passengers it carried last year, but not by much.

Christian Keldsen, chief communications spokesperson for Air Greenland, said for this past month of June, the route attracted only four more passengers than last year.

“I’m not sure that counts as an increase, but you know, we’re hanging in there,” Keldsen said.

That’s after a bleak start to the season. Air Greenland’s first flight from Iqaluit had to be cancelled because nobody booked a flight during the first week.

This was to be expected though, Keldsen said, as flights started earlier — at the end of May this year — as opposed to the start of June last year.

Air Greenland also decided to extend its season until the end of September in 2013, whereas the season ended at the beginning of September last year.

But the reason for a lack of interest in the flight is related to the problems that mining exploration and prospecting companies are experiencing in moving ahead with their projects, something Keldsen said was also the case in 2012.

The route had been created largely to accommodate the mining and exploration business, and to attract more companies from North America to travel via Iqaluit rather than first flying to Europe and then to Greenland.

“We’ve got the same problem this year as we had last year with the oil and mineral exploration permits,” Keldsen said.

That means exploration companies are waiting for the Greenland government to give them the go-ahead before they can actually go to Greenland.

According to Greenlandic Bureau of Minerals and Petroleum, there are currently 19 prospecting licenses that have been granted in 2013, and 63 exploration licenses that have been granted as well.

And there are currently 27 applications for exploration licenses and two prospecting licenses currently “under application” with the government.

“[There’s] not very much activity here as we were expecting. Next year hopefully,” Keldsen said. “That’s also what we said last year.”

Keldsen said the numbers for July look much better than last year, although he doesn’t have final numbers yet.

Companies have also been holding back to wait and see what Greenland’s new government, the Siumut party, elected in March, will do in resource development, Keldsen said.

“It’s been holding [some] back to check out what the new government is going to do and what direction they’re going to go in. And I think the companies, especially the banks, have spent the last three or four months analyzing the stability of Greenland,” Keldsen said.

In April, Greenland’s new premier Aleqa Hammond said there needs to be a “measured” way for offshore drilling in Greenland, and she said there will be resource committees put in place to control mineral exploration and extraction.

Roussos Dimitrakopoulos, a professor at the department of mining and materials engineering at McGill University, said the lack of mining prospectors on flights to Greenland has more to do with a slowdown in commodity markets and lack of demand for minerals and ore.

“The mining industry globally has been contracting after a long boom, there have been layoffs and restructuring,” Dimitrakopoulos told Nunatsiaq News in an email.

“This usually means that exploration is hit the hardest and probably this is the reason that the volume of work and travelling to Greenland has been seriously reduced,” he said.

But Keldsen’s prediction that next year might be a break-through year might be correct.

“As far as I hear, there are genuine expectations [that] things will change next year, but this is always an expectation, and time will tell,” Dimitrakopoulos said.

Tourism is helping push the number of passengers up on Air Greenland flights for now, said Keldsen.

“I think what saved us last year, and also this year, turns out to be tourists. Especially those people locally travelling between Greenland and the Nunavut region,” Keldsen said.

Last summer marked the first time in more than 10 years that you could travel directly from Iqaluit to Greenland.

In 2001, First Air stopped their weekly jet service between Iqaluit and Kangerlussuaq. Air Greenland then looked at starting up a route between Nuuk and Iqaluit in 2010, but those plans were dropped.