COUNCILLORS in Solihull have deferred a decision on whether to approve Birmingham International Airport's (BIA) £400 million sterling expansion plans.
The decision is crucial for Aer Rianta, which is currently in advanced negotiations to buy a 40 per cent stake in Birmingham Airport. Aer Rianta and its partners, NatWest Ventures, are the preferred bidders but the deal is understood to be conditional on BIA winning planning approval for the expansion.
A confidential report circulated to the seven local councils which own the airport claims that any delay in planning approval would almost certainly lead to Aer Rianta pulling out of the deal.
The future of the £400 million plan, and Aer Rianta's proposed involvement with BIA, now hinges on two weeks of further negotiations between officials from Solihull council and representatives of BIA's management. BIA's managing director, Mr Brian Summers, has said the airport "needs to see a clear decision on the application as soon as possible".
The discussions, to be held before a vote is taken on the matter on March 5th, will be aimed at limiting the development's impact on the surrounding environment. However, the council's decision to uphold seven strict conditions relating to the expansion may force a public inquiry on the issue, which would delay the expansion plans by at least two years.
BIA has agreed to five of the seven new conditions but says that those banning night flying and curtailing any runway extension for 30 years are "fundamentally unacceptable".
The airport management is still hopeful that some form of compromise can be reached. But, if the council insists on the conditions relating to night flying and the runway extension, BIA will lodge an appeal with the British Secretary of State for the Environment, Mr John Gummer. The appeal would result in a public inquiry.
A spokesman for Aer Rianta said last night that it was "inappropriate to comment" on the matter at present. But the State-owned airports authority seems certain to reconsider its position if Birmingham airport's expansion plans are curtailed or delayed.
BIA needs cash from Aer Rianta and Nat West Ventures to help fund its £400 million plan as the British government does not allow airports within the public sector to raise cash themselves for such developments. The expansion will double the size of the terminal buildings at the airport and increase the number of aircraft stands by 50 per cent.
Aer Rianta and NatWest Ventures will pay up to £60 million for the 40 per cent stake in BIA whose owners, ironically, include Solihull council. The other six councils are in favour of the expansion.
