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Keflavík airport future challenges face Iceland following final closure of US Naval Air Station

Iceland’s close-knit aviation community is furiously debating the future development and management of the huge Keflavík international airport following the long-anticipated final closure last week of US Naval Air Station Keflavík.

The substantial US presence had been a Cold War fixture for decades and the withdrawal leaves scores of buildings and vast areas of tarmac for potential civilian use.

But it has also generated a management dilemma because the existing administrative structures essentially separated the running of the airfield itself from the commercial terminal – and the issue of private versus public operation of large utilities, and the outsourcing of some functions, is a sensitive one in Iceland.

At the Icelandic civil aviation authority's annual aviation symposium, delegates representing the airport, airlines, government departments and assorted other interests, spent much of the day in debate over what should happen next.

Keflavík airport chief executive Björn Ingi Knútsson told the audience: “We have already had difficult operations over the past three years as the USA has been reducing its operations, and [it’s been] difficult to do things that we felt they should do – like clearing the runways, for example.

“A lot of the development that remains at the airport is old. The radar, the fire engines and the crash and rescue units are becoming so aged that they are regarded by ICAO [International Civil Aviation Organization] as the minimum [acceptable].”

Knutsson concedes the airport’s current weaknesses but says that the situation can be improved so long as the revenues that it earns are earmarked for its own improvement.

He has already sparked huge controversy in Iceland by outsourcing some security functions, but insists that his thinking is in line with the government’s overall philosophy and says: “I want to see tenders for – for example – flight protection and security. This is in the spirit of the government’s actions.

“And now is the time to merge the operation of the terminal and the airport. It is normal that aviation falls under one ministry. Everybody knows that it makes sense.”

He also touched on the thorny question of whether or not Keflavík should remain for international use only, describing that as an explosive debate that he did not want to get into on this occasion, but saying there was a requirement for “careful planning”.

There has been talk of the former military area of the site being used by one of the freight integrators as hub, or by the Icelandic military for troops, and for some of the hangars becoming movie studios.

“I think we should take it easy and look at things holistically, one step at a time,” cautions Knutsson.

Broadly supporting Knutsson on the need for outsourcing, the chief executive of Keflavík-based Icelandair, Jón Karl Ólafsson, added: “This is a timely change. But we should go further and we should use the positive aspects of private business in order to make this as well-run as possible.

“My advice is to start with a blank sheet and build on what we have – and that is simply how we would operate Keflavík without the defence force. I think it would be much more economical with private ventures.”

Noting that the airport is forecast to handle one million passengers per year in the near future, he added: “It is a very poor terminal building. It is a shame, it is a disgrace to us all, and we need a new terminal. We have to finish the new terminal and this must be done through a private undertaking as soon as possible.”

The US pull-out has left behind an odd legacy. Read Kieran's blog.

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