Seaplanes to hop past Indonesia's lack of airports

By Neil Chatterjee and Janeman Latul

MOYO ISLAND, Indonesia, Oct 9 (Reuters) - The seaplanetaxiing over a coral reef to deliver tourists to a remote luxuryresort may soon become a more familiar sight in Indonesia, anarchipelago of 17,000 islands and only 183 airports.

At the moment, seaplanes in Indonesia are limited to nichecharter flights for high-end tourism and mining, but their usecould spread to serve the needs of a fast-growing economy and tobeat the lack of transport infrastructure.

State-owned domestic carrier PT Merpati Nusantara Airlinesaims to start the first scheduled public seaplane services inthe country since the Dutch colonial period, when seaplanesregularly hopped across the main island Java. It is in talkswith Canada-based planemaker Dornier to buy 20 seaplanes in a$120 million deal.

"There is no way infrastructure development can fullyservice Indonesians ... We're talking about a lot of islandsthat have no airports but need government attention. The onlylogical way is using amphibious planes," said Rudy Setyopurnomo,Merpati's CEO.

Seaplanes ferry passengers from Bali's airport east to theMoyo island hideaway, where Oliver Stone filmed 'Savages'earlier this year, in about an hour - less than half the time itwould take on a helicopter.

The planes splash to a gentle landing on turquoise water andjettison excited passengers right onto the resort's jetty.

"That was amazing - even smoother than a normal landing. Andso convenient - much more comfortable than a helicopter," saidAnna, a tourist from Moscow, as she fed bread to the parrotfishswimming under the seaplane's tail. "It will make a lot ofplaces more accessible. A jumbo jet can't do a water landing."

Operator Travira Air also runs seaplanes from Bali andLombok for staff at Newmont Mining Corp's massive copperand gold mine on nearby Sumbawa island, saving executives a fourhour journey to the airport and cutting costs for the company.

Renting the plane for 100 hours flying time a month costsaround $140,000, versus over $200,000 for a helicopter carryingless people, Travira says.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Indonesia to take on debt for infrastructure Booming coal capital defies downturn Lion Air dreams of runways ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

Seaplanes symbolised the romanticism of early flight butwere killed off by the jet age as regular scheduled transport.The prospect of a renaissance in Asia reflects not only theunique geography of places like Indonesia but also the sheerpace of Asia's growth in demand for planes.

Indonesia's government aims to finance 15 new airports in2013, but is also relying on attracting billions in privatefinancing for infrastructure. Progress so far has been slow,leaving Merpati looking at a solution not requiring runways -the 20 seaplanes.

"We're going to buy them now. We expect next year to be thefirst delivery," said Setyopurnomo, adding the planes could bebuilt locally under a partnership with local planemaker PTDirgantara Indonesia.


The Dornier Seastar planes, with turboprop engines made byUnited Technologies Corp unit Pratt & Whitney, look likeflying speedboats. They carry around 12 passengers and flyfaster than the eight-seater Cessna Caravan Amphibian thatTravira uses.

"It is the first new seaplane developed in the past 50 years... It can park anywhere you can tie a boat up," said DonMcClaughlin, Dornier's vice-president for sales. "Our twobiggest target markets right now are Indonesia and China."

Dornier and Cessna Aircraft Co, a subsidiary of Textron Inc, face seaplane competition from Canadian firm VikingAir's 19-seater Twin Otter.

In China, Waterfront Air says it is applying for licenses touse Twin Otters for scheduled services between Shenzen, HongKong, Macau and Guangzhou's industrial Pearl River region.

Elsewhere seaplanes are common in remote locations such asthe Maldives, British Columbia and Alaska, but there are fewscheduled services.

The Dornier and Cessna seaplanes have a maximum range ofover 1,500 km (930 miles), just about enough to fly fromIndonesia's capital Jakarta with one refuelling stop to theeasternmost Papua region. But the cargo they can carry dropsafter about 300 km, making them more suitable for inter-islandhops or operations around a base in far flung provinces.

Other challenges include a lack of specialist pilots, sincelocals often get poached by rapidly expanding budget carriers,regulations such as the need for annual landing permits, andlarger waves in the rainy season making landing impossible insome locations, said Rudiana, Travira's chief operating officer.

"If we can get over these challenges there are a lot ofopportunities," said Rudiana. He cited potential demand in areassuch as the huge Natuna gas field off Borneo that ExxonMobil

hopes to develop, tourism around islands such as Sumatraand Sulawesi, and for firms in Papua, home to major projects forFreeport McMoRan Copper & Gold and BP .

The Twin Otter would be useful as it can carry a higherpayload much further, but charter airline Aviastar has struggledto get an operating license for one in Indonesia, known for itsred tape.

"We could use a bigger plane - flights are packed on aSaturday as everyone wants to head off for the weekend," saidPeter Ferrigno, the logistics manager for Newmont's mine.

(Additional reporting by Alison Leung in Hong Kong and TimHepher in Paris; Editing by Jonathan Thatcher)

((neil.chatterjee@thomsonreuters.com)(+ 62 21 3199 7170))