Aer Arann has been selected as the preferred tender to operate Public Service Obligation (PSO) flights to the Aran Islands.
The announcement by the Department of Arts, Heritage, Regional, Rural and Gaeltacht Affairs follows a lengthy process and controversy over the future provision of the air route.
Last year, the Government abandoned the initial tender for the four-year contract, after it had named Executive Helicopters as the preferred provider.
That led to protests by island residents about the nature of the service and the proposal to use Galway Airport as the mainland arrival and departure point.
When the tender was re-advertised in April, it was stipulated that the service would have to operate from Aer Arann owned Na Mine airport, near Indreabhan.
After several months of negotiations, the department has now formally announced Aer Árann as the preferred tender.
A two-week standstill period is allowed before contracts are signed, to allow for any objections.
The new contract is scheduled to run from 1 January until the end of 2020.