The developer of the first airport on Koh Phangan, home of the full-moon party, is seeking a capital injection of 1.5 billion baht to complete the facility.
Kannithi Aviation (KA), which operates commuter carrier Kan Air, is in talks with a few foreign financiers for soft loans to finish the airport, as costs have run up to about 2 billion baht.
President Somphong Sooksanguan told the Bangkok Post that the company had opted to acquire funds via loans rather than a joint venture to ensure that the project can proceed more smoothly.
The company is seeking foreign loans, which incur only 2% annual interest compared with the 7% charged by local banks, to help drive project costs down, he said.
Kannithi Aviation is moving to tackle the financing issue in anticipation that Thai authorities will endorse the environmental impact assessment (EIA), a major prerequisite for starting construction on such projects, by year-end.
The company has already spent some 500 million baht in acquiring about 200 rai of land on Thailand's fifth-largest island, with some land grading having already been carried out.
Mr Somphong said the funds will go towards further land grading, building a passenger terminal capable of processing 1,000 passengers a day and a 1,095-metre runway which can accommodate turboprop aircrafts in the size range of the ATR 72-600 series.
If everything goes according to plan, the airport will be up and running by the end of next year, he added.
The project, originally estimated at 900 million baht, has faced inflated costs, delays resulting from the EIA and other complications, which pushed back initial plans to open in 2014.
Once operations get under way, the airport will be open to commercial airlines as well as Kan Air. It is set to provide direct air access to Koh Phangan island for holidaymakers, especially international revellers attending the world-renowned full-moon party.
Currently visitors can only reach Phangan by seagoing ferry, either from Surat Thani, which is 55km away, or Koh Samui, which is 15km away. Bangkok Airways operates an airport on Koh Samui, Thailand's third-largest island.
Once it is completed and regular services are launched, Phangan airport will siphon away some air traffic from Koh Samui, particularly foreign tourists heading for the full-moon party and those seeking a less crowded alternative to Samui.
Lying north of Koh Samui and two-thirds its size, Koh Phangan has beautiful beaches and less expensive accommodation than its neighbour.