If it wasn’t so serious, you’d be chortling at yet another tunnel stuff-up that’s captured the NSW Labor Government. Less than 24 hours after releasing that second load of documents about the Cross City Tunnel, the Government has been embarrassed by a direct threat to human and life and property in the Lane Cove Tunnel.

The reports, involving a hole 10 to 15 metres long and more than 10 metres deep (it breached the tunnel after a rock slippage into the tunnel overnight) started rolling in the early hours this morning, shortly after 2am and before the documents from the previous day’s release had been fully digested. Here’s a report on the latest revelations about Cross City Tunnel.

Many political operatives were looking forward to settling down and reading the thousands of pages released by this most cynical of Governments, and its Roads Minister Joe Tripodi. They were released as the Melbourne Cup was being run in Melbourne, an act of political cynicism that’s typical of Tripodi, who seems to be a Teflon minister because of his role in pushing Morris Iemma into the Premiership.

According to early reports, the Cross City tunnel operators have the NSW Government by the short and curlies and yet there’s still no move to sack the then Minister, Carl Scully. No wonder Bob Carr jumped to the golden halls of Macquarie Bank. What’s more interesting is that a bloke called Paul Levins is the head of corporate affairs for the tunnel builder, Bauldestone Hornibrook. He was the chief of staff to the former NSW Infrastructure Minister, Craig Knowles.

Makes you wonder just how the NSW Government can claim to have been so ignorant of what was going on when it ran the department negotiating with the tunnel builders and operators, and had at least one strategically-placed former operative in place as an early warning system.

The slippage and rising damage bill for the Lane Cove Tunnel will crystallise growing concerns about the agreement with its builders and operators, the Leighton Holdings subsidiaries Thiess and John Holland. Leighton shares slumped as much as 80c this morning and by 10.30am were down 43c to $14.84, a loss of $119 million in market capitalisation.

Transfield Services is the long-term operator and maintainer of the tunnel and its shares fell 10c to $7.20. You’ve got to feel a bit sorry for Hong Kong billionaire Li Ka-shing whose CKI is the major shareholder in both troubled tunnels. Check out this upbeat press release when the 40% Lane Cove Tunnel investment was made and this link explaining the 50% stake in the Cross City Tunnel.

What next? Some sort of massive power blackout to stymie CKI’s forthcoming $1 billion-plus Spark Infrastructure float of its Australian electricity operations.

With the same party on the other side of the table, it is no wonder there’s believed to be similar agreements in place with both tunnels to restrict alternative road use. Perhaps the NSW Government can be forced to release all these documents before the Lane Cove Tunnel opens and hopefully this latest problem will force an early debate.

There’s a block of units that will have to be demolished and Epping Road – perhaps the second most important road into Sydney – which is closed today as workers attempt to stabilise the situation by pumping hundreds of tonnes of concrete into the hole.

Residents from the area reported they’ve been having problems with water pressure over the past four months. This morning it took several hours for the builders to confirm that it was the rock slippage that caused all the problems. Under the tunnel agreement there was supposed to be constant monitoring of the ground by the companies while the construction went on. The water pressure problems for the past four months call that into question.