The cost of WestConnex has ballooned since a $10 billion project was proposed in 2012. The cost now sits closer to $17 billion. Sydney Motorway Corporation, the organisation delivering the motorway project, told Rozelle residents in a letter drop on Monday that "one option being considered is an additional, direct underground connection between the proposed new interchange at Rozelle and Iron Cove Bridge". The bridge was duplicated in 2011. Residents were also informed that the construction of a tunnel would require a widening of part of Victoria Road. That will inevitably mean some homes and businesses will need to be compulsorily acquired. The corporation said the extra tunnel under consideration was designed to "better link the north-west to Anzac Bridge and the WestConnex motorway, which has the potential to reduce traffic on Victoria Road though Balmain/Rozelle by almost 50 per cent".

Roads Minister Duncan Gay says a decision has yet to be made about the final stage. Credit:Peter Rae The letters to residents whose properties could be acquired were delivered on the same day Roads Minister Duncan Gay said a final decision on acquisitions in Rozelle had yet to be made as part of the final stage of WestConnex. Mr Gay reiterated in a statement on Tuesday that no decision had yet been made on the final design of the link between the M4 and M5 motorways, "but we are always looking for the best options to fix traffic congestion in Sydney". His office would not answer any questions about the estimated cost of a new tunnel, the stretch of Victoria Road likely to be widened or where the interchange at Rozelle was now likely to be sited. It is also unclear if the cost of the new tunnel will come from the WestConnex budget. When the government committed to adding a motorway ramp to provide access from WestConnex to Olympic Park and Lidcombe, the cost of that $140 million project came from a separate "Housing Acceleration Fund", ostensibly to stimulate affordable housing.

A major interchange is expected to be built in and around Rozelle's old railway goods yard, though it is unclear how a new Victoria Road tunnel would connect. About 200 properties are being acquired for the first stage of WestConnex, and 159 for the second. WestCONnex Action Group spokeswoman Pauline Lockie said the addition of a tunnel and widening of Victoria Road would be "hugely expensive". "[The government] needs to come clean about what the project is really costing and residents need to be told what is going to be acquired – not just in Rozelle but across the entire route." she said.

Contractors are already carrying out geotechnical work in Rozelle and Camperdown in an attempt to determine exactly where major interchanges for WestConnex will be built. "No decision on the final design [of the third stage] for the project has been made and several options are under consideration by the NSW government," Sydney Motorway Corporation said in the letters to Rozelle residents. NSW Greens transport spokeswoman Mehreen Faruqi said the government was "attempting to build its way out of the traffic jam that will be created by WestConnex". The government also plans to build the Western Harbour Tunnel, a road link from Rozelle to North Sydney, immediately after WestConnex is completed, in part because the new motorway will boost traffic travelling into the city on Anzac Bridge. The business case for WestConnex forecasts another 20,000 cars a day using Anzac Bridge, and also predicts more traffic on Victoria Road when tolls are reimposed on the M4 motorway from next year.

The cost of WestConnex, to be built over the next eight years, has climbed rapidly since a $10 billion project was proposed by Infrastructure NSW in 2012. Last year the cost ballooned from $15.4 billion to $16.8 billion. The scope of the project also continues to expand. First proposed to run in a "slot" carved through Parramatta Road, the motorway now largely avoids that busy corridor. And the government has also committed to subsequent extensions of the project across Sydney Harbour in a "Western Harbour Tunnel", potentially continuing on to the northern beaches, as well as a southern extension to the Sutherland Shire. These subsequent extensions are planned to be built once the initial 33-kilometre project is finished in 2023. The project is being part-funded by the federal and state governments, but so far they have committed only $5.3 billion in direct funding and concessional loans to the motorway.

Construction has been under way on the first element – a widened M4 motorway between Parramatta and Concord – since early last year. Loading Excavation of twin 5.5-kilometre tunnels for the M4 East, which connects Homebush and Haberfield, began this week and will take 18 months to complete. It means the first stage of WestConnex is scheduled to open to motorists in 2019.