The petrol tanker that burst into flames near Wollongong has taken 130 firefighters five hours to get under control but amazingly left all unharmed.

Key points: The Princes Highway is still closed in a southbound direction

The Princes Highway is still closed in a southbound direction The tanker was carrying 35,000 litres of petrol and two of its fuel compartments were damaged

The tanker was carrying 35,000 litres of petrol and two of its fuel compartments were damaged Drains have been covered to stop fuel run-off

The truck caught fire about 8.40am on the Princes Highway — the main artery between Sydney and the Illawarra — which is still closed in the south-bound direction.

Residents and people in a nearby childcare centre were ordered to evacuate and the situation was described as "hectic" by childcare worker Elise Fitzsimmons.

"There was a couple of explosions and then with each explosion the flames just got more a more, and higher like fireballs," she said.

"We really didn't know what was happening, then I saw the flames and I thought oh my goodness I've got to get these kids out of here right now."

The group made it out safely and sheltered in a home further away, until parents could collect their children.

The scene was described as "hectic" by authorities. ( ABC News )

Fire and Rescue NSW Inspector Norm Buckley said it was a "very, very fierce fire" but luckily the driver escaped without injuries.

The fire is believed to have started in an engine compartment, authorities say.

The tanker was carrying 35,000 litres of petrol in its six separate fuel compartments, two of which were damaged by the fire.

"[When the] first compartment … was damaged it started leaking, which caused a lot of that sensational footage," Superintendent Jeff Roche said.

"We managed to insert [foam] into the tanker and into the compartments and that prevented that fire from getting any larger."

Black smoke billows above houses in Figtree. ( ABC News: Sean O'Brien )

Authorities warned the salvage and clean-up around the Figtree on-ramp would take many hours.

Mr Buckley said hazmat crews were in attendance and put booms across drains very early on to stop diesel run-off from the truck.

"Crews are liaising with the EPA as well, just to ensure that if there's any fuel leakages there is minimum impact on the environment."

Drivers should expect significant delays and southbound traffic is being diverted at Mount Ousley Road.

From about 3.30pm onwards, the highway reopened in a northbound direction.



The tanker company, Metro Petroleum, is organising another truck to decant the fuel and tow the burnt-out truck away.

Federal MP Sharon Bird lives nearby the scene of the fire has told ABC Illawarra she also evacuated as a precaution.