Nigeria’s biggest Airline, Arik Air temporarily suspends operations

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(Adds comment from Arik on resumption of flights)

ABUJA (Reuters) – Arik Air, Nigeria’s largest airline, cancelled all flights on Tuesday in what it called a temporary disruption related to insurance renewal.

While the company initially warned the disruption was likely to continue for the next few days as it awaited approval from national insurance commission NAICOM to renew its insurance with a new company, a spokesman later told Reuters it would resume flights from 11 a.m. on Wednesday.

“All issues have been resolved,” spokesman Ola Adebanji said, declining to comment on how it had resolved its insurance problem or why it had changed insurance companies.

Arik, which flies to London, New York and Johannesburg, also has a maintenance contract with Germany’s Lufthansa.

“We are fully committed to returning to our normal operations and minimize any unfortunate inconvenience to our passengers,” Arik Chief Executive Michael Arumemi-Ikhide said in a statement on Tuesday.

Nigerian airlines and international carriers operating within the country have struggled with a plunge in the local currency, the naira, that has made it difficult to get U.S. dollars to buy jet fuel and also to remain profitable as passengers pay in naira. The nation’s first recession in two decades is also squeezing profits.

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James Daudu, deputy director at the country’s aviation ministry, said that while jet fuel prices are deregulated, and therefore outside government control, the Minister of State for Aviation was working with the Ministry of Petroleum Resources to see if “interventions” in the sector were possible.

“It would be a whole sphere of intervention, if possible, from the Central Bank of Nigeria to the Ministry of Petroleum Resources,” he said.

Two other local carriers, Aero Contractors and First Nation, recently suspended operations, though the government said both would eventually reopen.

International carriers United and Iberia stopped their services to Nigeria earlier this year, while others have begun refuelling abroad to avoid jet fuel shortages. International airlines have complained about the difficulty of repatriating millions of dollars’ worth of fares sold in local currency. (Reporting by Libby George and Camillus Eboh in Abuja and Alexis Akwagyiram in Lagos; Editing by Greg Mahlich and Matthew Lewis)

 

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