Virgin spokewoman Danielle Keighery said the ash plume was considered too low for safe air travel and the airline had made the decision to cancel all flights out of both capitals from this afternoon.
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A decision on flights scheduled for tomorrow morning is expected to be made later today.Virgin has cancelled more than 170 flights as a result of the ash cloud, affecting an estimated 120,000 passengers across the country.
Earlier today, Qantas cancelled all flights out of Sydney from 3pm and added that its Melbourne flights may also be affected at some stage.
Passengers were urged to stay in touch with their airlines.
Qantas spokeswoman Olivia Wirth told Sky News this morning: "We simply don't have enough information and it will be safety before schedule."
"We don't know the density [of the cloud]. ... The Qantas group will not be flying or around the particular cloud."
"Customers are advised not travel to the airport if their flight has been cancelled. A fare waiver is in
place and full details can be accessed on qantas.com," Qantas added in a statement.
Airservices Australia says the ash cloud from Chile has returned bigger and denser than last week’s one that disrupted air travel for days and could hang around longer.
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