Part of the Queenstown Trail network, the new Shotover Gorge Trail forms the second stage of the trail expansion project to link the northern side of the Wakatipu Basin to the wider trail network.
The 108m Hugo Tunnel, near the mouth of the lower Shotover Gorge, will be the centrepiece.
The trust had donated $735,000 to cover the restoration work for the tunnel, construction of which was initially planned during the goldrush, to divert the river and allow the riverbed to be mined for gold.
It was built in 1862 by the Kawarau Diversion Syndicate, which intended to dam the river and generate hydro-electric energy to power a dredge at Big Beach.
However, the project was abandoned because the tunnel was considered too small, and located at a level that was too high to accommodate the river.
Restoration work, which has started, included stabilisation of the tunnel portals, removal of rock-fall material, installation of rock bolts, structural anchors and mesh, and constructing the new trail surface.
Archaeologists will also be involved to identify and catalogue historic artefacts throughout the works.
The Hugo Charitable Trust was founded by Hugh Green’s eldest daughter, Maryanne, in 2017 to continue her father’s philanthropic legacy in New Zealand.
The tunnel had special significance because of Mr Green’s history in the civil construction industry — after migrating to New Zealand from Ireland, Mr Green and Barney McCahill formed Green & McCahill Ltd, which became one of the best-known civil construction companies in New Zealand, completing some of the country’s most significant projects, including a long list of major tunnels.
Hugo chairman and trustee Mark Owens said in a statement that Mr Green would have understood the hard work and toil which went into the tunnel’s construction, and believed it would be a "fantastic asset" for the community and visitors to the area.
Queenstown Trail chief executive Mark Williams said the tunnel would become a "must-visit location" on the trail.
"It will be a unique experience to ride or walk through the tunnel, and gold mining history is an integral part of how our region has developed.
The new trail was expected to be open to the public this summer.
