Yes, there are underground canals in New Orleans. The city's canal system is made up of a network of underground and above-ground channels that were built in the 19th century to help control flooding and to transport goods.
The most well-known of these underground canals is the New Basin Canal. It was built in the 1830s to connect the city with Lake Pontchartrain, and it was used to transport goods and people to and from the city. The canal is now mostly filled in, but a portion of it still exists underground and it's visible in some places such as the City Park.
Another underground canal is the Carondelet Canal, it was built in the 1820s to connect the city with the Mississippi River. The canal was used to transport goods and people, but it was also used to drain swampy land and to control flooding. The canal is mostly filled in, but a section of it still exists underground and can be seen near the intersection of Canal Street and Elk Place.
In summary, there are underground canals in New Orleans, the most well-known is the New Basin Canal and the Carondelet Canal, both were built in the 19th century to help control flooding and to transport goods, they're mostly filled in but some portions of them still exist underground and can be seen in some places in the city.