By NATARIO McKENZIE

and NEIL HARTNELL

Tribune Business Reporters

A Cabinet minister yesterday declined to intervene in the dispute that has prevented Sky Bahamas from flying for three weeks and left it on the brink of financial collapse.

Dionisio D'Aguilar, minister of tourism and aviation, instead urged Captain Randy Butler, the airline's principal, to continue meeting with the Bahamas Civil Aviation Authority and "work out" his differences.

Addressing the matter ahead of yesterday's Cabinet meeting, Mr D'Aguilar said: "I believe, although I haven't confirmed, that he had discussions with the regulator. I want to be very clear: No minister of aviation with any sense is going to intervene on a safety issue.

"If Sky Bahamas has a matter before the Bahamas Civil Aviation Authority, it's up to him to figure out how to get the necessary approvals in order for him to obtain his air operating certificate (AOC)."

Mr D'Aguilar continued: "I don't have the technical expertise to intervene on his behalf; this is something he has to work out with the regulator. The aviation sector is highly regulated with a lot of technical standards and technical rules, which the regulator knows and the operating airlines know.

"He needs to sit with the regulator and work out what difference he has in order to bring ease and calm to the matter, and put the regulator at bay to fulfill all of the requirements that he has."

Captain Butler last night confirmed that Sky Bahamas' AOC, which is the permit required for an airline to carry fare-paying passengers, had still not been renewed as he accused regulators of linking the matter to debts the airline allegedly owes to Nassau Airport Development Company (NAD).

Arguing that the AOC was a separate issue from any debt owed to the Lynden Pindling International Airport (LPIA) operator, and that the two should not be linked, Captain Butler told this newspaper: "They're now attaching the fact we owe NAD, which is a completely separate organisation from the Bahamas Civil Aviation Authority."

Tribune Business understands that NAD and Sky Bahamas are now embroiled in a Supreme Court battle over that debt, although Captain Butler declined to go into details or comment on the matter.

It emerged last year that the airline owed NAD some $454,000 in passenger facility and security fees it collects from ticket prices on the airport operator's behalf, but Captain Butler said Sky Bahamas had been making inroads into this sum as well as paying what was due currently.

At the time he branded NAD's threat to terminate Sky Bahamas' airport operating licence as "a non-issue", adding that the debt owed had been reduced and that such a situation was not uncommon with other airlines.

Tribune Business understands that the Bahamas Civil Aviation Authority now wants to conduct an inspection of Sky Bahamas' premises and records tomorrow in a bid to determine whether it has addressed the regulator's safety inspection findings - findings that Captain Butler and the airline have bitterly disputed and contested.

The Sky Bahamas chief has repeatedly asked why, given that the safety inspection in question took place at end-May, the airline was allowed to keep flying for another month before the regulator ordered it to cease on July 8.

Sky Bahamas and other airlines are also subject to constant surveillance year-round by the Bahamas Civil Aviation Authority, with inspectors going on flights and attending training programmes. Captain Butler queried why no issues that could affect the AOC renewal were raised during that time, and why concerns were suddenly appearing now.

Voicing "surprise" at Mr D'Aguilar's reluctance to intervene, Captain Butler said Sky Bahamas' ongoing inability to fly during the "peak" summer period continues to cost it hundreds of thousands of dollars.

While the airline was effectively "past the point of no return", he added that several of its remaining 63 staff had agreed to defer their wages due yesterday for another week, while offers of financial assistance from outside had also inspired him to keep going.

Captain Butler said there were also "a number of very good options for strategic partners" seeking to invest in and join Sky Bahamas, adding that two had signed non-disclosure agreements despite the perilous situation in which the airline finds itself.

"As far as we're concerned we're past the point of no return had someone not come along today and said: 'Here's some help'," he told Tribune Business. "Based on the fact that we're not operating that will help pay the bills, and some staff have given me permission to go ahead for another week.

"We're trying to get this done in the next week. We're past that point if not for the help that's come in."