Police in Greymouth say the first bore hole broke through at the Pike River coal mine at 7am on Wednesday.
Drilling of a 162-metre hole above the mine began on Sunday afternoon.
Police on Wednesday confirmed the diamond-tipped drill bit had broken through into an underground roadway in the mine.
Pike River Coal chief executive Peter Whittall said air from the hole was extremely high in carbon monoxide and methane. It was low on oxygen.
The drilling started late on Sunday when it was thought it would take about 24 hours.
Nothing has been heard from the 29 men in the mine since an explosion on Friday and police say the situation is getting bleaker by the hour.
No rescue attempt will be mounted until rescuers know the conditions inside the mine won't cause another explosion.
However, Commissioner Howard Broad says the situation for those below ground is bleak and gets bleaker by the hour.