The three and a-half-year-old "Dart Passage" proposal for a 10.2km single-lane, 4.5m-wide tunnel, between the Routeburn and Hollyford Valleys, could halve the present return time from Queenstown to Milford of about 10 hours to less than five, using purpose-built hybrid diesel-electric buses.
Milford Dart managing director Tom Elworthy said yesterday the project had been "put on hold", largely because of the global recession and credit crunch which was affecting all forms of financing and borrowing.
"It would be very difficult to find funding in the present climate. It's a `wait and see' on how the economy shapes up. But we are still committed to the project," he said.
"It's not a race to Milford," he said, in reference to other separate proposals including a Caples Valley gondola, a Darran Mountains tunnel and monorail from Kiwi Burn to Te Anau.
Mr Elworthy said Milford Dart Ltd was prepared to wait two to four years to resume the project, but it was "likely to be a lot less than four years".
The estimated cost to date was "well beyond" $1 million, he confirmed yesterday.
In 2007, Milford Dart was denied authority to apply to build a road in Mt Aspiring National Park.
However, Mr Elworthy said yesterday the Department of Conservation had since agreed to the company proceeding with its application.
"The ball is back in our court now. But it's a matter of waiting for the right timing."
The Dart Passage proposal has roused concern about the future of Te Anau, which would be by-passed by the tunnel.
It has also raised environmental and safety concerns, including the disposal of 250,000cu m of tunnel spoil.
The effect on the overall prosperity of Southland tourism has also been aired.
Mr Elworthy said a concession application would include consultation, submissions, hearings and publicly-notified resource consent applications.
As well as attending hearings, Milford Dart had commissioned extensive reports on all environmental aspects of the project.
The initial concept, promoted by Milford Dart directors Mr Elworthy, Tim Allan, George Gould, Michael Sleigh and Richard Somerville, envisioned a three-to-four-year construction period for the tunnel, which would have a 1:30 gradient.
It would be a 365-day operation, from 7am-10pm daily, with hybrid-only vehicles which would reduce noise levels, exhaust and greenhouse emissions.
