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Sydney's heritage tugboat Argos hits final snag on the NSW Central Coast

The Argos will eventually be destroyed after being removed from Brisbane Water. (Supplied: Peter Duffy)

A piece of maritime history, one of Sydney's first steam tugboats, has come to a watery end on the New South Wales Central Coast, just months before it was due to undergo extensive restoration.

Volunteers from Transport Heritage Australia (THA) have spent years working on the Argos, which was built at Berry's Bay in 1903.

But their plans ran aground two weeks ago, when the heritage tug started taking on water on its mooring at Empire Bay.

THA founder and president Peter Duffy said within 24 hours, the tugboat was on the bottom of Brisbane Water, leaving the group with removal bill of up to $50,000.

"To have gone through this journey, to have her slip away so suddenly, there's a numbness about it" he said.

Hopes sink for heritage tug

Peter Duffy is devastated by the loss of the Argos. (Supplied: Peter Duffy)

Mr Duffy, who was out of the country at the time when was alerted of the problem.

The 120-year-old vessel was fitted with a comprehensive solar-powered electrical system, including four pumps and a two CCTV cameras.

He said the initial warning was that one of the cameras had gone offline, suggesting a battery had been run flat by running pumps.

Despite being able to see in real-time what was happening, Mr Duffy said action wasn't taken fast enough back home to save the vessel.

Turbulent ride for restoration project

It has been far from smooth sailing for volunteers working on the Argos in recent months.

Last November, the heritage vessel was granted a last-minute reprieve by NSW authorities, after it was deemed "unseaworthy" and ordered to be removed from where it was being moored.

The Argos, one of Sydney's earliest tugboats, spent its final days moored at Empire Bay on Brisbane Water. (ABC Central Coast: Scott Levi)

Mr Duffy described the journey as "exhausting".

"We poured almost all our resources into maintaining the fight to get to this stage," he said.

The tug was due to be towed to Sydney in September for its final major "out of water" overhaul.

The heritage steam tugboat was built at Berry's Bay in 1903. (Supplied: Buster Browne)

Steam tugs were a common sight on Sydney Harbour in the early 20th century, but most were long gone by the 50s and 60s.

The Argos, formerly known as the Gladys Ellison, was one of the few to survive.

The ABC understands Transport for NSW set a deadline of May 30 for the vessel to be removed from the waterway due to it being a navigation hazard.

"We don't have the resources financial or otherwise to undertake that, so Transport for NSW is going to remove her ... and destroy her, and dispose of her," Mr Duffy said.

"She will be taken to the tip."

In a statement, Transport for NSW Maritime confirmed it would have no choice but to remove the sunken tug from Brisbane Water, describing it as a "navigational hazard".

It said while the department was "sympathetic to attempts to restore the tug to its former glory", the owner had failed to respond to this week's final Notice to Remove the vessel.

A spokesperson confirmed NSW Maritime would take over the salvage operation and pass on all costs to the tug's owner.

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