By Alexander Cornwell

DUBAI, April 26 (Reuters) - Oman's new budget airline SalamAir will operate as many as 12 Airbus AIR.PA A320 narrow body jets by 2020, as it aims for profitability by the end 2018, its chief executive said on Wednesday.

Launched in January, SalamAir has started flights from Muscat to Dubai in the United Arab Emirates, Jeddah in Saudi Arabia and Salalah in Oman.

It plans to increase its fleet to between 10 and 12 A320s by 2020 from the three it has leased from Chile's LATAM Airlines LAN.SN , CEO Francois Bouteiller told Reuters in Dubai.

Two to three of those will be added in 2018, he said.

Bouteiller said the airline is yet to decide if it should purchase or continue to lease aircraft but that it would only be interested in current model Airbus A320s and not the 'neo' variant.

SalamAir expects to carry between 750,000 and 800,000 passengers in 2017 with a load factor - or how full its planes are - of between 70 percent and 80 percent.

Bouteiller said the airline would mostly fly to destinations within three hours flying time of Oman.

The carrier, owned by the Omani government pension funds and the Muscat municipality, will launch up to five new routes from May: Medina in Saudi Arabia, Sialkot, Karachi and Multan in Pakistan and Dhaka in Bangladesh, Bouteiller said.

SalamAir is the second airline operating in Oman after state-owned Oman Air. SalamAir operates a single economy class product with 174 seats.

(Reporting by Alexander Cornwell. Editing by Jane Merriman) ((Alexander.Cornwell@thomsonreuters.com;))