Kiwi International Airlines is looking at the possibility of replacing American Airlines which is set to pull out of the Boston-Bermuda run.

The news came yesterday from Kiwi public relations director Ron Kulat who said a decision would be made shortly as the airline was preparing its marketing campaign for next year.

Kiwi started service to Bermuda in 1995 from Newark and added flights from Atlanta and Chicago early the following year but was grounded and had to file for Chapter 11 reorganisation bankruptcy on September 30, 1996.

The grounding was blamed on past debts, a Federal Aviation Administration decision to partially shut the carrier down and the effects of the ValuJet crash on May 11 last year.

In January, the airline resumed regular domestic flights between Atlanta, Chicago, Newark and West Palm Beach in January after collecting a $5 million loan.

At the same time it began informal discussions with the Department of Tourism.

Yesterday, Mr. Kulat said the airline was still looking at the possibility of returning to Bermuda and was hoping to start up service in Spring, 1998.

Mr. Kulat said Kiwi would definitely not fly out of Atlanta to the Island again as it "ran very hot and cold for us'' but was considering a Newark to Bermuda run and service between Boston and the Island.

However he stressed: "Nothing has been decided yet.''.

American Airlines general manager Carol DeCouto said on Wednesday that it was unlikely that American would fly to Boston from the Island next year because of a lack of aircraft and a poor season this year.

She added she did not feel the Boston market was large enough to support two carriers. Delta Airlines provides the only other link to the Island from Boston.

Mr. Dodwell said last night that he had not had a final decision on the future of the AA flight.

He added: "The New England area is a major market sector for us and certainly from September to May it's the leading area for business.

"My belief is that there is business to support a second flight from Boston.

"We would be interested in talking with any reputable airline which is capable and interested in picking up the Bermuda route.''