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Last Thursday, the council restricted residents and farmers' use of
the North Bruce rural water scheme after announcing a major leak was suspected and warning the reservoir's level was ''critically low''.
Council district assets manager Jules Witt said yesterday he could not rule out a major leak, but the reservoir had recovered from 44% of its normal capacity to 64% following rain and fixing some minor leaks on the line.
By Monday this week the reservoir had risen 600mm, gaining 1.1 million litres of water, and was 58% full.
''As long as the reservoir is increasing rather than going down, then we're positive, really,'' Mr Witt said.
''We're going the right way. It's still very low; it's still of concern.''
Water use restrictions would be reviewed at the end of this week.
Lovells Flat residents expressed concern last week water restrictions imposed by the council could signal a return of
January's problems, when the area's rural water scheme failed.
Water stopped running into holding tanks on resident and former district councillor Joanna Lowrey's neighbours' farms and the water from her taps turned yellow and had a strong stench.
The council determined then that a failed valve was responsible.
Mrs Lowrey said the water issues were an ongoing concern at Lovell's Flat, south of Milton.
She said facing a possible widespread water outage with a critically low reservoir - without drought conditions in the area - was unacceptable.
''We're not living in a Third World country. We need to be doing better.''
Lovells Flat dairy farmer Stafford Ferguson said he had been forced to buy water from Balclutha this year as the scheme struggled.
He believed high usage could be a factor.
''It's just one of those years that the scheme has struggled ...
to keep up,'' he said.
As Lovells Flat was at the end of the North Bruce scheme, his farm was in danger of being left high and dry.
''It's something that is going to have to be looked at. I wouldn't want any more [outages] - that would make me really nervous.''
Mr Witt said the water scheme was at capacity and there had been a moratorium on subscriptions for over a year.
''I wouldn't say it's over-subscribed.''
The limit for the scheme's capacity was the consent limit and not a limit to what the treatment plant could produce, he said.
After the water scheme's current problems had been identified and fixed, the council would look into how to avoid a similar situation in future.
New monitoring equipment for the reservoir was already being priced. After a similar incident at Moa Flat in West Otago 12 years ago, the capacity of the reservoir was increased by raising the height of the dam by 1.5m at a cost of about $500,000.
''It's far too early to make those sorts of calls, but we'll be looking at that later on,'' he said.