UPDATE 2-Virgin America says it was awarded Dallas airport gates

Fri Apr 25, 2014 6:00pm EDT

(Adds comment from American, paragraph 4)

April 25 (Reuters) - Virgin America said on Friday it would offer new flights from Dallas Love Field after it was awarded two gates at that airport by the U.S. Justice Department.

The San Francisco-based carrier said it planned to start flights between New York's LaGuardia, Ronald Reagan Washington National, Los Angeles and San Francisco airports and Dallas Love Field in October.

The gates are being given up by American Airlines Group as part of its merger settlement.

"The DOJ approved one airline to acquire the gates at Love Field, and we are working on a sub-lease agreement with Virgin America," American said in a statement on Friday.

The deal is subject to approval of the City of Dallas, and Virgin America said it was confident the city would clear it.

American agreed to give up takeoff and landing rights and gates at various airports to settle the U.S. lawsuit that sought to block its merger with US Airways. Virgin America recently won takeoff and landing rights at New York's LaGuardia Airport and Ronald Reagan Washington National Airport that American divested.

Southwest Airlines Co, which controls 16 of 20 gates at Dallas Love Field, and Delta Air Lines Inc have also expressed interest in the two Dallas Love Field gates.

In a statement, Delta said designating the two Love Field gates as "common use gates" managed by the City of Dallas was the best option for their use.

"While American was bound by its merger settlement with the Department of Justice to release its gates, any sublease proposed by American must be approved by the City Council," Delta's statement said. "If the City exercises its right to not approve the sublease, the airport can operate them as common use."

Southwest spokesman Brad Hawkins said his company appreciates "the opportunity afforded by the City Council to show how the Southwest plan is best" for the use of the two gates.

Virgin America, a carrier in which Richard Branson's Virgin Group holds a minority stake, plans to move its current operations at Dallas Fort Worth Airport to Dallas Love Field should it obtain the gates. (Reporting by Karen Jacobs in Atlanta; editing by Andrea Ricci and Matthew Lewis)

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