Bloomberg Australia: Born-Again Virgin?

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Welcome to our weekly newsletter — a fresh, global perspective on the stories that matter for Australian business and politics. This week: The bid to save Virgin Australia, Hollywood comes calling and the future of fossil fuels.

When Virgin Australia CEO Paul Scurrah faced the media this week to discuss the rescue plan proposed by buyout firm Bain Capital, one quote in particular stood out.

“I applaud the courage of Bain to save an airline in the middle of a pandemic,” he told reporters.

Courage indeed.

Scurrah himself said it’ll be at least three years before demand for domestic and short-haul international travel returns to pre-Covid-19 levels. There’s a real chance it could be even longer, he added.

Bain’s strategy is to cut the workforce by a third, scale back the fleet, and ditch budget brand Tiger Australia. But even a slimmed-down airline faces enormous challenges, with state borders closed and the trans-Tasman bubble effectively on ice until infection rates in Australia are brought under control.

The uncertainty is playing out in aviation markets across the world. As my colleague Christopher Jasper writes, just a month ago, airlines began adding flights as national lockdowns eased and people craved an escape from hibernation. But as the travel season reaches what should be its annual peak in the Northern Hemisphere summer, hopes for a rebound have been dashed by flareups in Asia, a deepening health crisis in the Americas, and the re-imposition of flight curbs in Europe.

Some 34 carriers have failed so far this year, including U.K.-based Flybe, SunExpress Deutschland and Miami Air, while Richard Branson’s Virgin Atlantic has filed for Chapter 15 bankruptcy protection in the U.S.

The 6,000 workers who’ll be kept on at Virgin Australia, and the many travelers hoping one day to use up flight credits, will certainly be rooting for Bain’s courageous plan.

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Despite the pandemic, Australia’s film industry is on a roll. A clutch of Hollywood studios have been lured here by tax breaks and other enticements, with cast and crew members exempt from the ban on international travelers.

The 1984 cult horror flick “Children of the Corn” has been shooting in and around Sydney, while Walt Disney’s Marvel film “Shang-Chi and the Legend of the Ten Rings” is about to resume after a four-month hiatus.

“We’re all getting inundated with calls, people saying how can we come down and film,” CEO of Screen Australia, Graeme Mason, told my colleague Thuy Ong. Read more here.

In a sleepy corner of Australia, a key battle over the future of fossil fuels is about to be decided.

By early next month, a panel will rule whether to green light Santos Ltd.’s A$3.6 billion Narrabri natural gas project, about 500 kilometers northwest of Sydney. Bloomberg’s James Thornhill examines the decade-long struggle that’s pitted farmers and activists against oil producers amid an ongoing debate about the economic benefits of gas and the environmental damage associated with the industry. —Edward Johnson

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A Santos pilot well operates on a farm property in Narrabri. 
Photographer: Brendon Thorne/Bloomberg

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