Federal Member for Newcastle Sharon Claydon has welcomed the news that FlyPelican planes would again take to the skies with the help of Federal Government support.

"This is great news for Newcastle and our regional economy as these flights will help keep us connected throughout the COVID-19 pandemic and positioned well for the all-important recovery and rebuild phase," Ms Claydon said.

"This Commonwealth support will help keep FlyPelican solvent until travel demands increase - when their staff can return to work and operations can be scaled-up as soon as the restrictions are lifted."

Ms Claydon said she'd lobbied the Federal Government in March to save the airline from imminent collapse.

"I wrote and personally met with the Deputy Prime Minister in Canberra, to advise him of the dire situation for FlyPelican and strongly urged him to act decisively to save this important regional service," Ms Claydon said.

"So I'm very pleased that the Government has listened and provided this lifeline."

Ms Claydon said the regional airline would play a critical role of the economic recovery process.

"FlyPelican will be vital in supporting trade and tourism activity between the eight cities and towns it services, many of which have been hit hard by the downturn."