Cougar Energy (ASX: CXY) may have reason to celebrate although it is not quite out of the woods yet. The underground coal gasification plant near Kingaroy QLD had been put on hold last month when traces of benzene and toluene were found in bore water supplies in close to the plant.
The Department of Environment and Resource Management said that it tested 10 bores in the last week and only 3 had traces of the chemicals. The results were well below Australian drinking water guidelines.
The farmers within a 2 km radius had been banned from using local bore water supplies. The Kingaroy Concerned Residents Group feels encouraged by the low level of chemicals in the bore water but fear that if a pilot program could cause so much contamination, what would happen if the plant worked at full capacity.
The negative publicity is not doing Cougar any good with it having to lay off half its staff and restructure its business.