Fugitive Stephen Maddren was only metres from the grasp of his pursuers just hours after he did a runner from the Otago Corrections Facility.
The inmate remains at large in spite of a search by authorities that is about to enter its fourth night.
It is understood that authorities saw Maddren on Tuesday night near the prison, but were distracted by the lights of an oncoming car and the escapee vanished into the darkness.
At the time, Maddren was less than 100m from people who were looking for him.
Searchers thought those in the car might have been coming to pick him up.
Fairfax Media has also learned that Maddren, 25, was being led from the prison reception to his cell when he escaped on Tuesday afternoon.
Department of Corrections is launching an inquiry into the escape.
Corrections Minister Anne Tolley has also promised a full review into how Maddren managed to escape while being led back to his cell.
Tolley, who was reporting to yesterday's meeting of the Law and Order select committee said Maddren was a remand prisoner, so the first question she would ask was why video links weren't being used for his appearance in court.
"You can risk-assess every prisoner and the staff can do their very best, but these are highly volatile, unpredictable people.
"These are not good people otherwise they would not have been charged and be waiting in prison," she told the committee.
Labour's correction spokeswoman Jacinda Ardern, also addressing the committee yesterday said Maddren, who escaped by scaling a downpipe and jumping off a three-story building, had made previous escape attempts.
Ardern said he was being transferred without handcuffs.
'IT'S GETTING TOO COLD'
Dunedin police searching for Maddren had a message for the fugitive: "Give up, it's getting too cold ... and we're going to get you in the end."
Maddren was last sighted in an overnight search of a forest area not far from the prison on Tuesday night.
Police converged on a house on State Highway 1 close to the facility early this morning when a resident heard sounds in her ceiling. That turned out to be a false alarm but the search continues, Police Area Response Manager, Senior Sgt Al Dickie said.
Police searching properties found a broken window at another house, also on SH1 near the prison, he said.
About 12 police staff from Dunedin, Mosgiel and South Otago were involved in the search today, checking cribs which were not often used at this time of year, Dickie said.
Dickie said if Maddren was still in the forest area searched yesterday, he could be struggling because of cold temperatures.
"It will be worse for Maddren the longer he stays missing."
Maddren, who was from Dunedin, was "very agile" and "quite a slippery character", who had contacts in Christchurch that police were "checking out".
Dickie said the escapee was not believed to have any contacts of interest outside the prison in the Milton area.
However, police were advising people to be vigilant, ensure cars and homes were locked, and to report anything suspicious. Police were happy to check it out, he said.
Residents in the small township just north of the prison were locking their doors, a staff member at the local information centre said.
Helen, who did not want to be identified, said she was ensuring her doors were locked even while she was at home.
"He might be trying to get back into the prison, I don't know," she said, referring to Maddren having to endure freezing temperatures out in the open in the area overnight.
She was appalled at the way things "had been left to slide" the day Maddren escaped when he was being returned to the prison from a court appearance in Dunedin.
"It sounded a bit funny to me. Slack."
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