Work on Sydney motorway to resume after sinkholes halted project

Tunnelling for a new motorway in Sydney's south will recommence after collapses and sinkholes halted the project more than two years ago.

Almost 90 per cent of tunnelling on the M6 project was completed when works stopped after two subsidence events in early 2024, which put a nearby building at risk of collapse.

In early 2025 all significant underground works ceased on the $3.1 billion project, which will link Arncliffe with Kogarah in Sydney's south via 4 kilometre twin tunnels.

The NSW government and Transport for NSW have now reached an agreement with M6 Stage 1 consortium CGU for works to resume.

About 250 metres of excavation of the main tunnel remains, with construction to be completed under the terms of the original design and construct contract at no additional cost to taxpayers.

Roads Minister Jenny Aitchison said work would begin immediately.

"It's a great outcome that we have got the contractors back onto site," she said.

"It's taken a long time to do that, but I think it's been worth having these negotiations to get this outcome, which is in the best interests of the communities around the M6, but also the taxpayers of New South Wales.

"In coming months, people will see work focusing on improving the ground across West Botany Street and around the areas of subsidence, and there'll be advanced design work for the final sections of the tunnel that will also progress at the same time."

Ms Aitchison said under the deal, CGU would bear the costs for rectifying the subsidence.

"CGU has agreed not to pursue those claims for the two subsidence events that happened in 2024, and they'll work to rectify that area," she said.

"They will have contested legal matters. They'll run through a dispute resolution, which has already been established under the contract in parallel, though, to completing construction.

"There's been no change to the budget, and currently the government's not paying any more than that contract sum of $2.55 billion to complete the project."

An updated timeline for the works is yet to be released, but the delivery date has already been delayed until 2028.

NSW Motorways CEO Camilla Drover said ground stabilisation works would be required before tunnelling resumed on the areas affected by the subsidence events.

"We've confirmed there are viable technical solutions to complete all aspects of the project," she said.

"They will start quite soon on that ground stabilisation."