In this article, we explore a particular variant of neoliberal thought by analysing the proposal, design, funding and operation of an element of transport infrastructure in Sydney, Australia that was developed as a public–private partnership (PPP). Although there has been considerable work on the theoretical advantages and disadvantages of PPPs, there has been little empirically informed critical analysis of how PPPs operate in practice, and even less on how environmental arguments are selectively used to justify PPPs. The Cross City Tunnel (CCT) is one of Australia’s most controversial examples of urban transport infrastructure. Although an engineering success, the CCT was far from being environmentally sustainable, socially just or economically viable. The CCT reveals the contradictions of neoliberal policy regimes, shallow sustainability rhetoric, the inappropriateness of the PPP model for other urban infrastructure developments in Sydney and internationally, and a capacity on the part of the partners to learn inappropriate lessons.