It was the start of night shift when the tunnel began filling with gas.

Workers going underground at the Snowy 2.0 site say they were told that there was nothing to worry about, that it was just water vapour.

But on that Saturday in early July, chemistry had finally caught up with them.

The previous year, the giant machine digging tunnels for the project had caused a sinkhole to open up.

Workers had spent seven months trying to stabilise the nearby ground, pumping in thousands of litres of grout, cement and polyurethane foam.

Now that foam had triggered a chemical reaction, producing toxic gas.

Snowy Hydro, owned by the federal government, has never disclosed this safety breach, even as it pumps out highly produced videos and press releases.

It was not meant to be this hard.

The pumped hydro project, trumpeted as a grand "nation-building" scheme, was first estimated to cost just $2 billion. It's blown out to $12 billion.

It was expected to produce its first power next year — now, it won't be keeping any lights on for at least another four years.

Snowy Hydro has revealed to Four Corners as much as $2 billion of this blowout can be blamed on the stalled tunnel boring machine they call Florence.

Its 15km journey below Kosciuszko National Park should be well underway by now, but it's gone just 150m.

Insiders say warnings were ignored — Florence was doomed from the start.
'Dare to dream'

At Florence's launch, in March 2022, then-Snowy Hydro chief executive Paul Broad was in an expansive mood.

"In life, you dare to dream," he told the assembled school children, mayors, and workers.
Dozens of people in high-vis and hard hats stand by a tunnelling machine several stories high. In front of it is a rockface.
Launch day for Florence the tunnel boring machine.(Supplied: Snowy Hyrdo)

"You think about the kids and the world they are going to inherit."

Snowy 2.0 was sold as being key to a low-carbon future — capable of powering 3 million homes for an entire week.

Its vast network of tunnels and underground power station would only be possible, Mr Broad said, because they had hired the world's best tunnellers.

But even as local school children signed their names on the 2,400-tonne boring machine, those working at the site knew trouble lay ahead.

In the weeks before Florence was launched, workers had drilled ahead to explore the tunnel's planned route.

Four Corners has been told that around 100m in, they hit soft ground. Thousands of litres of water gushed out.

It should have been a moment to pause.

Instead, one worker says the hole was simply plugged and they launched Florence as planned.

Just eight weeks later, it hit the predicted soft ground and water. From that moment on, the machine was effectively bogged.
Assorted pipes, hoses and machinery with an amount of muddy water at their base.


"We would push forward 50cms then spend the next week clearing out all the mud and water from around the tunnel boring machine," one worker says.

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

At the time, Snowy Hydro told the public nothing about these problems.

In Snowy Hydro's words, Florence is "one of the most technically advanced machines in the world". With a price tag of more than $150 million, it's not just a tunnelling machine, it's a mobile factory.

But for the past 19 months, it's had little chance to show off. It's barely even moved.

The boasts are based on Florence's ability to operate in both hard and soft ground.

But to work in soft ground, a so-called "slurry system" should be in place, which helps shore up the ground ahead.

Not only was this slurry system not operating, its key equipment wasn't even on site.
A number of pipes half-covered by muddy flood water.
Florence wasn't equipped for the soft ground ahead.(Supplied)

This went against the project's own guidelines for Florence, which state this system should have been connected for the "start-up length" plus the first 1km. The Construction Method Statement from August 2021 did state the final decision should be made based on the conditions at the time.

Snowy Hydro chief executive Dennis Barnes was appointed in February this year and has been tasked with turning around the troubled project.

He says the contractor Future Generation knew the ground was soft before tunnelling began.

"We just didn't know it was that soft," he says.

The project's original champion, former prime minister Malcolm Turnbull, is not convinced.

"Clearly, it's an oversight, it's wrong. I mean, if you're going to be dealing with soft ground that needs to be slurried and you don't have the slurrying kit, you've screwed up, haven't you?"

Future Generation says, "drilling in advance of the tunnel boring machine" confirmed its operation method "was appropriate".

It says "every measure" was taken to ensure the tunnel was excavated "with diligence, care and in the safest possible working environment".
YouTube Inside the engineering megaproject that went horribly wrong
Sinkhole

As winter turned to spring last year, rumours that Florence was in trouble began circulating.

Rather than levelling with the public, Snowy put out another press release.

"Florence on the move," it said.