Tuesday, August 19, 2014

Repurposing

Here’s another interesting case for you: Suppose you are the general manager of an airport that no one is using, and nobody particularly wants to move into. It’s not a far-fetched situation, either; a lot of the smaller and less well-traveled US airports are falling on difficult times following the consolidation of the industry. Thirty years ago there were over 70 major airlines in the United States, and at least four dozen of them that flew coast-to-coast, all competing for passengers and guarding air routes to which only they had access. Getting permission to use a gate in an airport outside your normal system wasn’t possible, at least not at anything like an affordable price, and customers in a given city were limited to whoever was already entrenched there. Then Congress deregulated the airline industry and everything changed…

Today there are fewer than a dozen carriers with nation-wide operations left in the US, and most of the survivors have been moving away from direct, non-stop flights in favor of a hub-and-spoke system. There was a time when if you wanted to fly from Los Angeles nonstop to Des Moines or Pittsburgh you could just get on a flight and go, but this is no longer the case. Today you’d probably have to fly to Dallas or Chicago (on American) or Denver (on United) or possibly Phoenix (Southwest) and catch a connecting flight – and some of the minor airports aren’t even that lucky. Increasingly in the US you will need to get on a regional carrier that can connect you to a major airport and change airlines there…

The difficulty here is that an airport is (usually) a large, sprawling installation, and it requires a lot of expensive maintenance to remain operational, regardless of how many flights are landing there. And while it might be possible to use some of the airport grounds to launch other businesses, both the EPA and the FAA will probably take a dim view of that, not to mention what Homeland Security and the TSA are going to think. Unless you can find some form of revenue stream that can be generated using the existing facilities, or whatever resources are located in, around, or under those installations, a lot of the lesser airports are going to have to close…

Fortunately for the folks in Pittsburgh, they’ve just discovered one such resource: natural gas. It turns out that the runways at the Pittsburgh airport are sitting over a large, and previously undiscovered, natural gas field – and that modern horizontal drilling techniques can get at the gas without disrupting operations at the airport or weakening the integrity of the structures. Dallas and Denver both have working oil fields on their grounds, and have operated them for years without any ill effects. This is especially important in Pittsburgh, where the Economist is reporting around half of the airport’s current revenue is being taken up just paying the interest on various debts. Hopefully, this will be enough to keep the airport out of the sort of death spiral where it can’t afford to keep up its facilities, so fewer airlines want to go there, which lowers revenue still further and the cycle repeats…

It isn’t being reported at this time just how long the natural gas deposits might last. We can only hope that the people running the airport will use the time during which the gas is flowing to figure out their next move – because eventually the gas field is going to run out, and when it does they’re going to be right back to where they are now, trying to find some other financially viable use for a dying airport…

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