Niagara tunnel project running into more problems

The massive uncompleted Niagara Falls tunnel is seen in this undated photo.

A big drill burrowing a tunnel beneath Niagara Falls is encountering more problems as it has hit fracture rock formations that are proving difficult to punch through.

The stubborn rock formations could delay the $1 billion project more than a year past its original complete date of fall 2009.

Ontario Power Generation says once complete, the tunnel will harness the power of the Niagara River to create 1.6 billion kilowatt hours of electricity a year. It will provide power for 100 years.

The 2,000-ton boring machine, nicknamed "Big Becky," is the largest of its kind in the world. But the problems could force the company carrying out the drilling, Strabag AG, to change course and steer upwards from the original path.

The change of plans could now push the completion date past 2010, CTV Toronto's Paul Bliss reported.

The initiative is already six months behind schedule because of the difficult fracture rock formations and because the tunnel walls have been unstable, which has caused boulders the size of cars to fall onto the massive drilling machine.

The entire project calls for a 10-kilometre tunnel to be dug beneath the city.

The Ontario government says taxpayers won't be on the hook for cost overruns or delays because of its contract with the Austrian tunneling contractor.

According to the fixed-price arrangement with Strabag AG, the group will receive a bonus if it completes the project on time and on budget. If the tunnel isn't completed according to schedule, the company will take a payment penalty.

With a report from CTV Toronto's Paul Bliss