Creditors of Tonga's Royal Tongan Airlines are claiming over $16.6 million pa'anga, but so far only $2.21 million has been recovered from the sale of the company's assets and other funds, according to the liquidator's second report.

PricewaterhouseCoopers of Auckland, New Zealand, were appointed liquidators of the 19 year old Royal Tongan Airlines, which was placed into liquidation on 9 June 2004.

Their report to Creditors on 17 December, said the liquidation was still not complete. But so far they had recovered various amounts totalling $2.21 million. This included:

Frozen bank account$122,000,

Security deposit $30,000

NZ GST refunds $236,000

Debtors collections $71,000

Sale of Twin Otter aircraft $1.6 million

Nuku'alofa office assets $136,000

Overseas office assets $15,000

The liquidators said they were still processing creditors claims, which now amount to over $16.6 million. This included:

Secured creditors, $2.4 million

Preferential Creditors, including employees, $204,000

Unsecured creditors, including trade creditors, $14 million.

The liquidators noted that only 106 of the 206 employees of Royal Tongan had filed claims and they were encouraging the remaining employees to return their claims as soon as possible.

A Shorts SD3-60 aircraft was operated by agreement with a secured creditor and the liquidators reported that there was insufficient equity in the aircraft that would allow for realisatins be be made for the benefit of unsecured creditors.

The Hangar facility at the airport and associated assets were still in the process of being sold.

Royal Tongan was founded in 1985 and operated as the national airline of the Kingdom of Tonga, with an international passenger service around the Pacific and a domestic service between the major islands of Tonga.

The company's international operations ceased on 23 April 2004 after its leased Boeing 757 was repossessed by the lessor. By June 2004 the domestic operation had also been suspended due to maintenance requirements on its two aircraft and cash flow difficulties.