Officials now plan to build Beijing Capital International Airport's (BCIA) third passenger terminal to handle 35 million passengers per year instead of the 25 million projected a year ago.

A third runway will also be built as part of the CNY16.7 billion (US$2.27 billion) BCIA expansion, which will boost the airport's capacity to 70 million when the expansion is complete in 2007's second quarter.

Work begins at the end of the year, with 30% financed from China's airport construction fund and the rest coming from a mix of government and local-bank loans. Beijing hosts the Olympic Games in 2008, and the expansion will help BCIA cope with the surge of arrivals expected to start in late 2007.

The latest expansion should be enough to see BCIA through to 2018. Officials will then decide in 2012 whether to start building a second airport for Beijing outside the city or to add a fourth terminal and runway.

BCIA President Li Peiyang said officials put an earlier plan on hold to build a second airport at Lanfan in Hebei province, 56 miles outside Beijing, because there's still land available to expand BCIA. Beijing's mountains to the west and north pose dangers for aircraft on final approach, keeping the city out of considerations for the new airport, Li said, and "no suitable site for such a mammoth project is available elsewhere in the city."

It's extremely difficult to build airports within city limits in China, he noted. Landowners are reluctant to give up their property while other residents protest the noise, and BCIA's expansion touches on all of these problems.

"Residents staying within the airport vicinity are protesting on the noise that would be created with the construction and the anticipated surge in traffic," Li said. "It is going to be very costly relocating and compensating these people." BCIA officials were unable to determine the cost of the relocation.

The BCIA-Tianjin Bihai International Airport Group, formed locally last year, is expected to spearhead the expansion project. It is China's first large-scale interregional airport group that would provide services related to investments, design, refurbishment and construction of new airports in the country.

Last year BCIA handled 27.5 million passengers, an increase of 12.24% over the previous year and a stronger growth rate than the 8.29% that had been projected. Despite China being hurt by the SARS pneumonia outbreak, BCIA is expected to grow marginally this year.

Terminal 2, which opened in 1999, is the only terminal running right now, though Terminal 1 will re-open at the end of the year after a refurbishment project is finished. Once the airport expansion is complete, Chinese national flag carrier Air China and foreign airlines will operate from Terminal 3, while other Chinese carriers will operate from the other two terminals.

BCIA is the fastest-growing airport in China. Together with the two Shanghai airports -- Hongqiao and Pudong -- and Baiyun International Airport in Guangzhou, the facilities handle 35.5% of the total passenger traffic in China and 48% of the cargo movement. China has 143 airports in operation, and 31 handle international flights.