May 17, 2007 — Seaborne has presented the following information to the V.I. Legislature in support of its agreement with the V.I. Port Authority.
At this time, Seaborne remains satisfied that the V.I. Port Authority will continue to address our desire to improve existing facilities to boost inter-island transportation. The following relevant information has been provided to allay any pending concerns regarding Seabornes lease agreement with the Authority.
In 1998, after engaging in an open-bid RFP process, Seaborne and the Authority entered into an exclusive long term lease agreement approved by the Legislature and the Governor. In the interest of the enhancement of the safety of seaplane service, the agreement gave Seaborne the singular right to conduct seaplane operations in property owned, controlled, and/or under the jurisdiction of Authority. The agreement required Seaborne to invest no less than $150,000 in leasehold improvements.
In August of 2000, Seaborne was sold. The exclusivity of the lease was the determining factor in the new owners decision to purchase the company and provide capital in excess of $10,000,000 to fund growth and cover operating losses.
Today, Seaborne operates 4 twin-engine, twin pilot DHC-6-300 on floats, employs 120 Virgin Islanders serving St. Croix, St. Thomas, and San Juan with 50 daily flights. Since 1998, Seaborne and its stakeholders have invested over 100 times the amount originally required and safely carried over 1,000,000 passengers. Of the former, at least $1,500,000 was invested in leasehold improvements raising service levels and the value of USVI Government land holdings. The Seaborne Management Team has indeed lived up to the spirit in which the original agreement was crafted.
The above non with standing, Management believes much remains to be done. It is vital that the Company increase our flight schedule to spread out overhead allowing the lowering of ticket prices.
While the first priority is further downtown to downtown St. Croix to St. Thomas service, Seabornes business plan includes the addition of several markets including Frederiksted and St. John.
To this end, three more aircraft have been procured, the first of which should be in service by July. And to assist in bridging the gap until St. John flights begin, Seaborne will begin a seamless ferry link from St. John to San Juan and St. Croix as early as next week.
Seaborne Airlines has always been open to a respectful and mutually beneficial partnership that would allow us to speed up the internal growth path taken to date. While management has investigated several cooperative opportunities, including the latest, none have met the strict parameters we believe necessary to best serve ALL of our stakeholders including customers, employees, shareholders, and the Territory.
In conclusion, Seaborne Airlines has demonstrated the wherewithal to safely and continuously run a seaplane airline. While quick solutions are understandably attractive, history has proven that the airline business not one prone to such and a few brand new aircraft does not an airline make indeed, it takes the right people, the right aircraft, the right support, and the right preparation to do it. While forward progress may be slower than we want, it is happening and it is real, and the best is yet to come.
President & CEO
Editor's note: Omer ErSelcuk is the President & CEO of Seaborne Airlines and also serves as the Chairman of the St. Croix Chamber of Commerce and on the boards of Virgin Islands Hotel & Tourism Association and the Boy Scouts. Mr. ErSelcuk holds his Commercial Pilot Certificate, a Bachelor in Aeronautical Science from Purdue University and a Masters in Business Administration from the University of Missouri.
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