Papua New Guinea's Civil Aviation Minister Walter Schnaubelt says Air Niugini (PX, Port Moresby) and PNG Air (CG, Port Moresby) owe the state-owned National Airports Corporation (NAC) over PGK150 million kina (USD37.5 million) and have ignored repeated requests to pay. However, the carriers say this is not the case.

Schnaubelt told The Post Courier newspaper that the cited debts hampered the NAC's ability to upgrade airport infrastructure. The NAC is responsible for 22 airports around PNG, including the biggest, Port Moresby Jacksons International.

"These substantial arrears, totalling PGK150 million, have significantly hindered NAC's ability to implement essential upgrades, including expanding terminals and improving entry points," the minister said. "Despite repeated requests by the minister to past and current management to recover these funds, these amounts remain unpaid and growing."

State-owned Air Niugini is reported to owe over PGR120 million (USD30 million), while the privately-owned PNG Air, the country's second-largest scheduled operator, owes around PGK30 million (USD7.5 million).

"Air Niugini acknowledges its ongoing commercial arrangements with the NAC and remains committed to working collaboratively to resolve any outstanding matters," Air Niugini CEO Gary Seddon told ch-aviation. "While we do not disclose specific financial details, we can confirm that discussions with NAC are ongoing, with both parties engaging in good faith to achieve a sustainable and mutually beneficial outcome."

"Air Niugini continues to meet its agreed obligations with the airport SOE, and we are actively collaborating on projects to enhance airport infrastructure - initiatives that have not been undertaken by previous administrations of either the airline or the airport authority," he added.

"With the collaboration of key stake holders (of which NAC was one) the company (PNG Air) entered into a creditors scheme of arrangement, ratified by the National Court of PNG on December 15, 2023," PNG Air CEO Brian Fraser told ch-aviation."Since entering into the scheme of arrangement PNG Air has met all its liabilities to creditors, including NAC. In fact NAC’s own internal sources have suggested that PNG Air is the only PNG operator that maintains its currency in debtor payments to NAC. PNG Air is not in breach of its contractual obligations to NAC."