The New Caledonian government has approved the new fares of Air Caledonie effective from next Tuesday.
This means that the top domestic one-way fare between Noumea and the Loyalty Islands will be 125 US dollars, with discounts of up 50 percent.
The cost of air travel was a factor in last year's prolonged dispute, which on the island of Mare led to unrest and the fatal shooting of four people.
Last month, the government also decided to subsidise air travel for residents of off-shore islands.
To be eligible for the special fare, the traveller has to have lived in the outer islands for at least six months.
There is a limit of eight subsidised return trips a year per passenger.