Air Canada has no schedule to start flying from Toronto's downtown airport after failing to reach a deal with the terminal operator in time for the February launch it had planned.
The country's No. 1 airline said negotiations are continuing with City Centre Terminal Corp. to lease space at Billy Bishop Airport, but it would not identify the issues in contention.
Billy Bishop is a small airport on Toronto Island in Lake Ontario, close to the city's core.
"We are not in a position to confirm a revised timeline for start-up, but suffice it to say we look forward to resuming service as soon as possible," Air Canada spokesman Peter Fitzpatrick said.
The airline had planned to offer up to 15 daily non-stop flights from the airport.
Air Canada flights will be operated by Sky Regional Airlines Inc., a switch from Air Canada's regional carrier, Chorus Aviation Inc., which flew from the airport until 2006 under its previous name Jazz Air.
Sky is a regional operator that won Air Canada's competitive bid to operate the Island airport service.
Air Canada has said flights will be operated with Bombardier Q400 turboprop aircraft and that it intends to lease five of the planes.
Privately owned regional carrier Porter Airlines currently has a monopoly on flights from the Island airport. Porter chief executive officer Robert Deluce also heads City Centre Terminal Corp., which is in talks with Air Canada.
Mr. Deluce said the negotiations are confidential and he could not discuss details.
"We understand that Sky Regional is still in the process of finalizing licensing with Transport Canada," he said. "This licensing is required before any service can begin."
Air Canada lost a court fight last summer against the Toronto Port Authority, the federal agency that owns and operates the Island airport, and Porter Airlines to get additional flying slots at Billy Bishop.
The port authority announced in June that Porter had secured 44 of 90 new slots, Air Canada 30, and U.S.-based Continental Airlines Inc. 16.
Air Canada had argued the allocation process was flawed.