Regional airline Rex (ASX: REX) will resume services in Queensland after the State Government caved in to the carrier's force majeure declaration.
A last minute intervention from the Queensland Department of Transport and Main Roads (TMR) will allow Rex to resume full services in Queensland from today, with a reduced schedule to come into place from tomorrow.
While a final agreement between the TMR and Rex has not yet been reached, the airline says it will continue to run the reduced schedule in good faith until 8 April.
If a final agreement cannot be reached Rex will once again suspend all of its services in Queensland.
The change of heart from the Queensland Government came after Federal Minister for Agriculture, Drought and Emergency Management David Littleproud called upon the Queensland Premier to "show leadership and sit down with Rex".
"The people in remote towns like Birdsville and Bedourie need access to medicine and medical services," said Littleproud.
"The communities of Charleville and Cunnamulla should have the right to the same essential services as those in Brisbane.
"This is not an inconvenience, this is dangerous. The State Government has got to find some way of keeping Rex in the air and keeping regional and rural Queenslanders safe."
The airline first announced it would be pulling all services from Queensland yesterday morning, blaming a lack of State Government support for the shutdown of all services in the State.
The proposed shutdown was going to take place despite a sizeable $198 million support package for Australia's regional air networks which are struggling to stay airborne because of the Covid-19 crisis.
Because the funding from the Federal Government would only to cover one return weekly flight per route for regional airlines Rex said it would be unable to continue operating in Queensland without State Government support.
Rex will continue to service its remaining network in Australia outside of Queensland on a scaled back basis.
Updated at 10:23AM AEDT on 1 April 2020.
Get our daily business news
Sign up to our free email news updates.