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The first power station planned for the Snowy Mountains Scheme had a dam at the junction of the Guthega and Snowy Rivers diverting water into a tunnel through to the valley of White's River and surface penstock pipelines down to an above-ground power station at its junction with the Snowy River. The main construction village was built overlooking the dam site using mainly pre-fabricated huts imported from Norway for Selmer, the Norwegian contractors building the Guthega Project. Selmer flew in a total of 350 Norwegian workers between October 1951 and February 1952.
The workforce was keen on skiing and ski jumping as recreational persuits and quickly established the Selmer Norwegian Ski Club, the large Guthega Jumping Hill (that allowed ski jumps of about 50 metres) and a rope tow for skiers. Guthega hosted many Nordic events in the 1950's. 


Dam construction commenced in December 1951 and was completed in April 1955. Skiing continued at Guthega after most of the workers had moved on to other sites. In 1955 three of the cottages vacated by the departing workers were offered for lease to "bona-fide Ski Clubs". They were leased by Canberra YMCA Ski Club, SMA Ski Club of Cooma and Sydney University Ski Club . Surplus huts were sold, with some remaining in Guthega to form the nucleus of the ski village, whilst others were transported to various sites around the Snowy including Thredbo. Two new lodge buildings, for the Canberra YMCA Ski Club and the Blue Cow Ski Club, were completed prior to the 1960 winter. Construction commenced on Guthega Ski Club's lodge in 1962. Guthega continued to host Nordic and Downhill ski races. In 1961, for example, Guthega hosted the ACT Nordic Championships in July and the Balmain Cup slalom races in August.
A rope tow was established by the SMA Ski Club in June 1958 on the Tate East Ridge above the Guthega River, where excellent powder snow could often occur in winter and early spring. Prior to the 1960 ski season, it was doubled in length to 430m with a vertical rise of 150m. It was extended again in 1963. This tow continued to operate until the late 1960's, when its location was designated as a wilderness area and the tow was removed.