The Minister for Public Enterprise has rejected a fresh proposal from Ryan air to build and operate a second terminal at Dublin airport.
Ms O'Rourke has written to Mr Michael O'Leary, the Ryanair chief executive, saying the EU Commission - or the soon to be appointed independent aviation regulator - would not allow the Government to give the airline such special treatment.
Ryanair had said the new terminal would allow a substantial expansion of its Irish operations, which would bring millions of new visitors to the western seaboard.
If a new terminal was built at Dublin airport, it would have to be open to all users and the construction and operation of any new terminal on State land would have to go out to tender, a spokesman for the Minister said yesterday.
The Minister's letter was only received by the airline yesterday and the response from Mr O'Leary was characteristically colourful. The airline executive described the response as coming from the "Yes, minister" school of correspondence.
He said the Minister had not addressed the main issue he raised with her. "I will be writing back asking her whether or not she wants to support our proposal to open 10 new routes from Ireland to Europe and the UK, creating 500 new jobs and carrying two million passengers a year," he said.
The key to the €250 million (£197 million) plan was the establishment of a low-cost base at Dublin and Shannon where five aircraft would be based in order to service the routes.
The most effective way to achieve a low cost base, according to Ryanair, is for the airline to be allowed build and operate its own terminal in Dublin. This would allow it avoid the charges levied by Aer Rianta for the use of its recently expanded terminal.
It is understood that the company would also seek a long-term deal on other airport charges as part of the deal. Ryanair already has similar arrangements with airports in the UK and Europe. Mr O'Leary said the reference to objections by the European Commission was disingenuous. Although the airline was proposing to build and operate a second terminal, it would be prepared to share it with other low cost operators.
It would not object to Aer Rianta offering comparable deals to other low-cost airlines. He said Ryanair did not necessarily even want to own the terminal. "If somebody else wants to build it, that is fine," he said.
Mr O'Leary said that Ryanair would continue to press for the new terminal, which he said could be operational within 12 months. The new routes could be launched this summer if the Minister moved quickly to support the Ryanair plan. Ryanair has been critical of Ms O'Rourke, accusing her of protecting Aer Rianta's monopoly through inaction. The airline says her policies have resulted in a stagnation of traffic between Ireland and the UK and more than 10 airlines - including Aer Lingus - withdrawing from routes to and from Ireland.
The most recent withdrawal comes into effect today when British European will cease flying to London City Airport from Dublin. Virgin Express will shortly cease operations from Shannon unless a buyer is found for the low-cost carrier.
