Air Canada says it is discontinuing its service to Iqaluit next month, after offering flights to and from Nunavut's capital city for just over a year.

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Air Canada, under its Jazz banner, began flying to and from Iqaluit in March 2010. The airline said Monday that it will discontinue that route effective Aug. 1. ((CBC))

Officials with the national airline told CBC News they are pulling out of Iqaluit effective Aug. 1 because the route was not profitable enough in face of rising fuel costs and other factors.

"Air Canada will be discontinuing its nonstop daily flights — which ran from Montreal, Ottawa [and] Iqaluit — for commercial reasons, as the route did not meet the profitability targets which were set," Air Canada spokesperson Angela Mah said Monday.

Air Canada, under its Jazz banner, launched the Iqaluit route on March 28, 2010, making it the third airline to offer daily flights to and from the territory.

First Air also flies between Iqaluit, Ottawa and Montreal, while Canadian North offers daily flights between Iqaluit and Ottawa. Both airlines also fly to northern communities.

Mah said Air Canada is now contacting customers who had booked flights for after Aug. 1 to reschedule them on Canadian North flights.

Air Canada is working with Canadian North to allow passengers to travel on one ticket between the North and South, Mah said.

Mah said the airline may consider relaunching the Iqaluit route if fuel prices drop and other factors change, but she would not say if competition from First Air and Canadian North was one of the factors that led to the cancellation.