The ACT would still prefer to take light rail down Commonwealth Avenue and around State Circle on its way to Woden, despite a federal agency sounding the alarm over technical difficulties.
But the territory would look at the the possible benefits of reviving a so-called "dog leg" alignment through Barton, Transport Minister Chris Steel confirmed on Friday.
Mr Steel on Friday said $50 million worth of planning work over the coming year, funded in this week's territory budget, would inform further community consultation and an environmental approval process.
"We're at a very early stage, but we've always said that this would throw up some challenges of being a major complex project going through an area of national significance," he said.
Mr Steel said the preferred route remained taking the light rail from Commonwealth Avenue onto State Circle.
"It's really great to have the [National Capital Authority] on board working co-operatively and indicating they're willing to work with us flexibly to assess those options fully so that we get the best outcome for the entire national capital, including the residents of Canberra," Mr Steel said.
National Capital Authority chief executive Sally Barnes on Thursday told a parliamentary committee the ACT's preferred route was "proving technically difficult".
"It's not off the cards yet, but we're expecting to have discussions with the ACT government fairly soon about - would there be another way to traverse the national triangle?" Ms Barnes said.
"We're more than open to have a look at those other ways because if it's difficult, it's difficult."
Mr Steel said the territory government wanted to look at a broad suite of options to address technical and heritage issues.
"We'll be confronting those as part of the design in order to understand fully what those technical challenges are and what the different options are that we'll need to consider," he said.
"We are going to work milestone by milestone through the planning and design process to address those challenges."
The ACT government in 2018 said its preferred route for light rail's second stage would turn left into the Parliamentary Triangle at King George Terrace from Commonwealth Avenue. The indicative route would travel through Barton back to Adelaide Avenue.
However, then-ACT transport minister Meegan Fitzharris in 2019 said it was likely light rail would travel wound the eastern side of State Circle, dropping the Barton "dog leg".
The latest precinct map includes stops at Kings Avenue, Sydney Avenue and Melbourne Avenue.
The Canberra Liberals' acting leader, Jeremy Hanson, called on the government to cancel the project, which he said could cost up to $4 billion.
The chair of the Public Transport Association of Canberra, Ryan Hemsley, said he had hoped the Barton dog leg had been ruled out and its potential revival was an unwelcome development.
"There are many commuters who may not relish the possibility of having to travel at 20kmh through Barton, between Woden and the city," Mr Hemsley said.
"But we wait with interest to see the outcomes of the environmental impact statement on stage 2B to see what the various pros and cons of each route are."
