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The “complex” Snowy Hydro 2.0 project continues to face delays, months after a sinkhole and a gas leak caused operational difficulties.

ABC’s Four Corners program revealed on Monday the $2bn project, which has since blown out to $12bn, has faced a number of safety and operational delays.

The project’s use of a $150m 400-tonne boring machine, called Florence, has caused chaos for workers and planners in recent months.

The tunnel project, which aims to dig the 15km journey below Kosciuszko National Park, was launched in March 2022.

Four Corners reported on Monday Florence has only completed 150m since the project began because of geotechnical issues the workers faced when they hit soft ground 100m into the dig.

The stalled project has added another $2bn to the budget blowout, according to Four Corners.

Despite the initial concerns, the project continued on when the machine became bogged due to water and soft ground.

“We would push forward 50cm then spend the next week clearing out all the mud and water from around the tunnel boring machine,” one worker told Four Corners.

“Sometimes there was 3 to 4 feet of water around the machine.”

To ensure the project could continue, so-called “slurry system” equipment was ordered but it was designed on inappropriate modelling.

Snowy Hydro chief executive Dennis Barnes, who was appointed in February, told a Senate estimates hearing on Monday the Florence machine continued to operate despite the difficulties it had experienced.

“There’s been no point since Florence experienced this soft ground in November 2022 that the machine has not been in some way been able to move forward,” Mr Barnes said.

“The slurry treatment plant, it has in fact moved 10m.

“It’s not bogged, it is able to move.”

Mr Barnes accepted he was naive when he took on the project earlier this year and informed a previous Senate inquiry that the project would be up and running sooner rather than later.

“I’m sorry to have understated the restarting of Florence … it was far more complex than I anticipated,” he said.

The project also saw a sinkhole open up just before Christmas.

Mr Barnes said this sinkhole was just outside the construction boundary.

The tunnel also filled dup with toxic gas in July as the work was underway in an attempt to stabilise the ground around the Florence machine.

Mr Barnes told Senate estimates this was caused by a chemical reaction which caused isocyanate, a hazardous chemical.

SafeWork NSW told Four Corners the gas posed a “serious imminent risk” to ”health and safety” and labelled the Snowy 2.0 project as having “inadequate control measures … to prevent exposure to a harmful substance”.

The project had also been issued a number of fines by the NSW Environment and Heritage Department.

Mr Barnes said the project was working with the state government to meet its compliance obligations and assured the Senate estimates hearing on Monday that the project is about 40 per cent complete.

“This is a complex project with many hazards,” he said.

Mr Barnes said while “design immaturity and geotechnical issues” had initially added to the budget blowout, the project still was important for Australia.

“The market really does need this asset and I would characterise this as something good for the Australian market,” he said.

“We have taken third party modelling and determined that over and above the $12bn there’s still a $3bn (estimated portfolio value).”

Snowy 2.0 has been pitched as a critical driver to the renewables transition and will aim to create enough clean energy to power half a million homes.

As of June, $4.3bn had been spent on the project, and is expected to be fully operational in late 2028.

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By Rahul

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