Dubbo Regional Council's now $9 million Boundary Road extension project is scheduled for completion soon after students go back to school after the Christmas and new year break.

Currently, there is one way in and one way out of Sheraton Road for motorists heading to St John's Primary School, St Johns College and Dubbo Christian School.

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The Mitchell Highway and Sheraton Road roundabout at the eastern entrance to the city was congested at the start and end of each school day before the city went into lockdown.

Dubbo Regional Council's two-stage project aims to "considerably alleviate an existing traffic choke point".

It will deliver a more than 1.6-kilometre arterial road servicing south-east Dubbo and its estates including Keswick and Southlakes.

The first stage of the project involving roadworks between Wheelers Lane and Alexandria Avenue was completed in late 2018.

Stage two, connecting Boundary Road from Alexandrina Avenue to Sheraton Road, was expected to be finished by the end of 2020.

But in March 2021 the council advised COVID-19 restrictions and changes to underground utility requirements would push the project to the end of the year.

On Friday, the council's director infrastructure Julian Geddes announced the late February completion date and the blowout in the project cost from $8 million to $9 million.

Mr Geddes identified stumbling blocks in progressing the project.

"Dubbo Regional Council has come across difficulty with some suppliers that reside outside of Dubbo coming into the local government area to undertake services, unplanned leave by council staff due to COVID issues in accordance with Public Health Orders for example close/casual contacts, family circumstances to name a few," he said.

The council, NSW government and Alkane Resources are reported to be funding the work.

"Council has received $4 million in funding from the NSW government under the Housing Acceleration Fund with the remainder of the funding provided through councils developer contributions plan," Mr Geddes said.

"Alkane Resources have monetary contributions to pay as part of a planning agreement associated with the mining approval.

"Those payments are not due to be paid at this time."

Mr Geddes said the project would "give all traffic requiring access to the three schools, the Bunnings/Blue Ridge precinct, quarries and future residential development an alternative route choice".

Work still to be undertaken includes construction of a footpath, two roundabouts, median islands, and kerb and guttering.

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