The excavator's operator, who was working at a construction site at a private home, reached out to grab a boulder with the machine when it shifted and sank into the sand, Deputy Fire Marshal Shawn McDonnell said.
The tide began to rise, and the excavator sank before construction crews had time to remove it.
"It's a sealed system, so it's highly unlikely anything will leak out of it," McDonnell said. "It should not have any environmental impact, but we did do a preventative booming around it."
The machine is not likely to be removed from the Sound until Monday, he said.
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