The cost of regulatory compliance is unbelievable these days, and I fear, is only going to get worse. Aviation is a policy free zone so the regulator has a free hand to pursue its own agenda.
That said, Hempy, if your acquaintance is really interested the Vincent Australian operation is for sale. See Friday's Australian Financial Review for the advertisement. I presume it is the shell only but the ad seemed to suggest the AOC was still there. That would save an awful lot of money and time.
However, regional aviation is a knife-edge game with pax loads so price dependant and costs ever increasing. It is interesting watching the established players grimly hanging on to those routes where the majority of pax are business orientated and will pay full fare if required. An example, Rex operate 4 or 5 full or nearly full flights a day to Wynyard which services part of the NW coast of Tasmania but with a population of only 40k. However, it is also the service centre for the West coast and the mines there. Lots of miners flying home to the mainland and vice versa. It must pay for a lot of marginal routes.