Government Ministers are considering designating a section of the existing Dublin Airport terminal for low-cost airlines as part of a package of measures to boost flagging tourism revenues next year.
The proposal would assign part of the building to Ryanair, the British airline Go and any other wishing to begin operating into the capital.
The aim would be to provide a more basic ground handling service for these carriers than at present, thus reducing airport charges from the £7 per passenger which Ryanair claims is excessive.
Government sources said last night that the more ambitious proposal to build an entirely new terminal at Dublin Airport, championed by Ryanair, was also under active consideration.
However, this is a longer-term project, and the Government is anxious to devise urgent measures to boost tourism numbers next year.
An interdepartmental group of senior officials, set up in the immediate aftermath of the September 11th attacks on the United States to consider their economic effects, is examining proposals to bring more passengers into Ireland.
The group, chaired by the Department of the Taoiseach, includes officials from the Departments of Public Enterprise, Enterprise and Employment, Tourism and a number of others.
Ryanair has lobbied the group strongly in favour of its wish to be allowed build its own terminal at Dublin Airport. It argues that this would result in the airline opening a number of new routes into Dublin, boosting tourist numbers.
However, a Government spokesman said last night there was no basis for a report in yesterday's Irish Independent that the plan to build a dedicated Ryanair terminal was to be considered by yesterday's Cabinet meeting.
The committee was still examining all the options, he said. Any decision would be "transparent" and would not be reached in the manner suggested by the report, said one source.
However, Government sources confirmed that giving over a section of the current terminal to low-cost travel was under consideration, as was the possibility of building on an extension to the current building for the purpose.
The Minister for Public Enterprise, Ms O'Rourke, is understood to be unenthusiastic about the idea of allowing Ryanair have its own terminal, believing that any new low-cost facility should be available to all low-cost carriers.
However, Government sources say other Ministers are more open to the idea, on the grounds that Ryanair is the only airline to have made such a proposal and offered to pay for the building.
The businessman Mr Ulick McEvaddy is believed to remain interested in building a new terminal, a proposal he first made a number of years ago.
Aer Rianta recently introduced measures to encourage the development of new low-cost routes into Dublin, including free landing charges for any new routes for the first three years of its operation.