The former owner of the Williamsdale service station has confirmed storage tanks leaked fuel into nearby soil and left "residual contamination" in the groundwater.
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The release of information by Icon Water, formerly ACTEW Corporation, came four weeks after neighbours expressed fears the service station – which operated for 51 years – may have contaminated its adjoining block, where a solar farm has been planned.
ACTEW paid $1 million to long-time block owner Bob Moore for the small site in 2009 but kept the service station, which Mr Moore operated until ill health led him to close in March 2012.
A spokeswoman for Icon Water said the company worked with the Environment Protection Authority to explore the site for contamination in December 2011 and initial investigations found hydrocarbons leaking from the two underground fuel-storage tanks.
These tanks were removed in 2012.
"Follow-up investigations and tests confirmed that there was hydrocarbon contamination, found in the excavated soil and residual contamination in the groundwater," she said.
Contaminants found at levels "beyond screening criteria concentrations" included lead and total petroleum hydrocarbons.
Icon Water's last results, from December 2013, found four of the 18 groundwater monitoring wells had exceeded the ACT EPA criteria.
"These four wells were located immediately adjacent to the fuel lines and underground storage tanks within the site boundaries," the spokeswoman said.
"It is reasonable to expect that groundwater levels would have reduced since this time."
Adjacent landowner Tony Davidson expressed concern a bore located on his property about 100 metres from the service station had been used for decades to provide water for domestic use, including drinking water.
Mr Davidson said, in 2012, an assessor on the service station site told him he was astonished by the amount of hydrocarbons coming out of the tap that was coming from the groundwater.
The Icon spokeswoman said if Mr Davidson's bore was registered to take groundwater the company should have been notified of its existence when it checked with the regulator.
However, it said it believed, based on advice, the use of water from the bore and for livestock from a nearby unnamed creek – which led to the Murrumbidgee River – did not pose a safety risk.
An EPA spokesman said both the petrol station site and the block proposed for the 34-hectare solar farm needed environmental audits.
The company installed fencing and safety signage on the station site to restrict access to the public.
There was "no evidence of contamination on private land or the creek" at the time of the block's sale to the ACT government this year, the spokeswoman said.
Land Development Agency chief executive David Dawes said earlier this month the agency was unaware of any contamination on the proposed solar site related to the service station, but contamination investigations would be continued.
"The LDA ... has widened the scope to include the possible use of asbestos-containing materials in former service station buildings and its associated waste disposal system," he said.
Mr Moore died in 2012. The Sunday Canberra Times was unable to be reach his widow.
Hydrocarbon sites make up about half the 1014 "potentially contaminated sites" the EPA is aware of in the ACT.
