The work is expected to be completed before Easter.
A Waitaki District Council spokesman said a recently discovered layer of clay meant the surface of the street could potentially slip.
Clay under roading could lead to layers above it slipping, "like a thick layer of butter in a sandwich".
Old road seal had also been found under a section of Stoke St and that would also have to be removed.
"The plan is to excavate until they reach a stable surface and then build up from there."