Tollway operator Transurban expects construction of a new $2.9 billion road tunnel in Sydney's north to start early this year.

The deal to build the NorthConnex Motorway was finalised on Monday.

The nine-kilometre tolled twin tunnels linking the southern end of the M1 Pacific Motorway at Wahroonga to the Hills M2 Motorway at its existing Pennant Hills Road interchange will be owned by Transurban and its partners in the Westlink M7.

NorthConnex is expected to take 5,000 trucks a day off Pennant Hill Road, improve air quality along the road by up to 38 per cent, and reduce the accident rate by up to five times.

Motorists are expected to save up to 15 minutes in travel time by avoiding stop-start arterial roads and bypassing 21 traffic lights.

The project is expected to be completed by the end of 2019.

Construction giant Lend Lease, and its partner, French construction firm Bouygues Construction, will design and build the tunnel.

The construction cost is $2.65 billion.

Transurban and its partners have the concession to collect tolls on the new tunnel until 2048.

NorthConnex is to be wholly owned by the umbrella entity known as North West Roads Group. Transurban will own 50 per cent of the North West Roads Group.

The federal government and the NSW government will contribute about $800 million to the project.

Transurban’s contribution will be $1.05 billion, which is about 50 per cent of the project funding requirement after the governments’ contribution.

“The NorthConnex project is a prime example of how the public and private sectors can work together collaboratively to deliver major transport infrastructure,” Transurban chief executive Scott Charlton said on Monday.

“This project has been accelerated by a decade, delivering clear benefits to the residents of Sydney well in advance of the timelines previously estimated for this project.”