Air North will be landing 737 jets at Dawson City this year as part of a contract with tour company Holland America to fly tourists between Dawson and Fairbanks, Alaska.

The airline hopes it will be the basis for a business case to pave the runway at Dawson City's airport.

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Air North President Joe Sparling says most Yukon runways were built more than 50 years ago for DC-3s and they don't meet the current reality.

But on Thursday's first flight, Air North used its Hawker-Siddeley turboprop aircraft because of compression maintenance work on the gravel runway in Dawson.

Air North President Joe Sparling says most Yukon runways were built more than 50 years ago for DC-3s and they don't meet the current reality.

Air North, First Air and Canadian North use Boeing 737-200s equipped with gravel kits to land on gravel runways. Boeing stopped making 737-200s in the 1980s.

"As we move ahead, the aircraft that can operate on gravel are getting less and less," he said. 

"If as northern air operators we want to modernize our fleets, our choices are pretty limited as long as we're operating on gravel runways."

Sparling says he recognizes it's costly to pave a runway, but he says it's time to start strategizing to update northern aviation infrastructure.

Allan Nixon, an assistant deputy minister with the Yukon Department of Highways and Public Works, says it's an issue the government is aware of.

"There's gravel runways all over the world, but I know where the carriers are coming from," he said.

He says right now there's no business case to pave new runways in the territory.