Telstra has blamed water damage to phone lines for the loss of connections to Orient Point, north west of Culburra Beach.
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Some residents in the small village, which is bounded by the Tasman Sea to the east and Crookhaven River to the west have been without phone connections for around 10 days.
Pat Lambert, who has lived in the village since 1984, says she hasn't had phone service since September 17.
"I'm 82-years-old and like me there is a lot of older residents out here," she said.
"Thankfully I have a mobile if there is an emergency, but it's a pre-paid and it costs me about $1 a minute."
Regional general manager for Telstra in NSW Chris Taylor said over recent days Telstra crews have been undertaking a complex repair to a telephone cable servicing the Orient Point area that had sustained water damage.
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"During this time up to 200 homes may have been potentially impacted with a loss of fixed line and ADSL2 internet services," he said.
"Mobile coverage was not impacted."
It is believed Telstra only received around 90 reports of issues with service.
Mr Taylor said services had begun being progressively restored.
"It was expected that full services to the area would be restored by late Thursday night," he said.
"Telstra apologises for the inconvenience caused by the outage and our technicians worked as quickly as possible to restore services."
Any residents still experiencing service issues they are encouraged to call 13 22 00 and report a fault.