ATLANTA, Aug. 10 (Reuters) – Delta Air Lines Inc. has received approval for a $1.2-billion overhaul of its operations at New York's John F. Kennedy International Airport that includes the expansion of one terminal.

Plans call for Delta to operate its international traffic from Terminal 4, which will be upgraded with additional gates and more baggage claim space. Terminal 3, the aging PanAm Worldport building Delta currently uses, will be torn down to make way for parking.

Delta will operate from Terminal 4 under a 30-year arrangement, said the Port Authority of New York and New Jersey, the airport operator that approved the project. The expansion is expected to take three years, with the Terminal 3 razing to begin immediately afterward.

The overhaul is expected to create 6,400 jobs and will be financed by Delta, with special project bonds and passenger airport fees.

Delta, currently the world's largest airline after its 2008 purchase of Northwest, is looking to strengthen its presence in high-growth markets as demand for air travel returns.

It has said upgrading JFK is essential to attracting corporate passengers as it builds a major hub in New York City.

This week, it also announced plans to improve dining services at its main terminal at LaGuardia Airport.
Delta handles almost a quarter of JFK's annual passenger traffic, the port authority said.