Louth County Council says it is not unduly concerned about the risk of pollution from what appears to be oil polluted water found in a culvert or drain off the main Dublin-Belfast road north of Dundalk.
A council spokeswoman confirmed samples were taken of the polluted material and from the nearby Flurry River yesterday and that officials from the council visited a number of sites including garages in the vicinity of Carrickarnon in an effort to establish the origin of the oil.
The area affected is close to the Border and the possibility that the pollution could be linked to an illegal diesel laundering operation has not been ruled out.
The Border is a popular location for smugglers and criminals who buy the cheaper marked gas oil and then use chemicals to launder it before selling it on and making a considerable profit.
According to reports yesterday the council had started to pump the polluted waters away from the main road but in doing so it was being piped into local streams. The council spokeswoman said this might have happened while a damaged culvert was being repaired but there was no cause for concern and the water supply was not affected.
An inquiry into the activities of senior council officials has been called for by Sinn Féin TD, Mr Arthur Morgan, "to see if they were aware of what was a potentially very serious pollution problem and did not act". Mr Morgan said "if there are no clear answers to this matter" by today he would contact the Environmental Protection Agency.