POLICE are trying to defuse a bomb strapped to a teenage girl at a multimillion dollar house at Burrawong Avenue in Mosman.
Assistant police commissioner Mark Murdoch tonight described the situation as a "very serious and sensitive matter".
"We are still treating the suspicious package as live," he said.
"I can't confirm whether it is strapped to the woman involved but she is still in the vicinity of the device."
When asked whether the girl could move away from the bomb, Mr Murdoch said: "No, she can't get away from it."
The woman is cooperating with police and bomb squad officers to defuse the device.
Mr Murdoch said police had to "hasten slowly" in a situation as delicate as this.
The drama unfolded at 2.40pm this afternoon when an 18-year-old girl called police to the mansion in Burrawong Avenue, Mosman 'following discovery of a suspicious device'.
It was not clear how the device came to be strapped to the girl but it is understood she did not place it there herself.
A senior police police officer described the device as an unusual 'collar bomb' which has never been seen before in Australia.
He said they believed it was an extortion attempt and that the initial details of the situation were being conveyed to police via the girl's father.
The girl, who is part of one of Sydney's wealthiest families is understood to be 'absolutely petrified'.
Police believe the ransom note is attached to her neck but bomb experts have been unable at this point to read its contents.
The street is home to racing identity Gai Waterhouse, ex-Wallaby Phil Kearns and John Eales
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Police have cordoned off the house and a command post has been set-up on the corner of Burrawong Ave and David Street.
Police Bomb Squad officers are currently examining the device, while other emergency services are in support at the scene with the teen's parents.
A third police rescue vehicle has entered the crime scene, as well as a number of detectives.
The girl is only in Year 12 and is believed to be studying her HSC this year. She celebrated her 18th birthday three weeks ago.
Her parents are outside the home comforting each other.
Police said they could not elaborate except to say a 'delicate operation' was in progress.
