The airline, which operates from Newcastle Airport, had been forced to suspend some flights because of the coronavirus crisis.

The subsidy will enable return flights from Newcastle to Sydney, Canberra, Ballina and Dubbo.

"There will be two return flights a week on all the routes we were operating, except for Sydney which will have three returns flights a week," chief executive Marty Hawley said.

The flights to Sydney and Canberra were particularly important for "essential travel and freight" and those requiring interstate links.

"It's keeping Newcastle connected to the rest of Australia during this period for people who still need to travel," Mr Hawley said.

The subsidy - provided through the Regional Airline Network Assistance Package - covers the airline's basic operating costs.

"We used to operate up to 120 flights a week. Now we'll be down to 36 flights a week. We're not going to make any money out of it at all, which is fair enough.

"This support should definitely help us get through, until travel demand increases again. Unfortunately, at this point, we won't be able to reinstate all our staff who were stood down."

The airline has applied to the JobKeeper program for staff.

Virgin, Jetstar and QantasLink have suspended their Newcastle flights.

While you're with us, did you know the Newcastle Herald offers breaking news alerts, daily email newsletters and more? Keep up to date with all the local news - sign up here

IN THE NEWS: