Officials tell Action News the leak occured when the gasket of two underground diesel fuel tanks blew at a New Jersey Transit bus lot on Route 42.
The fuel seeped into Grenloch Lake, near the Black Horse Pike and Central Avenue.
Neighbors who live along the Grenlock and Blackwood lakes and along the Big Timber Creek smelled the oil scent about 7:00 a.m.
"The inside of my house smells. We're afraid to drink our water; we have well water, here. We got birds dying all over the property and nobody's giving me any straight answers," Washington Township resident Bob Rezzetti said.
"When I was home just now, I couldn't even breathe it was so intense, the smell. So I just hope that it's safe," Cheryl Motja of Washington Township said.
New Jersey Transit hired a private contractor, who along with local firefighters laid absorbent booms all along the creek and its spillways.
"Our focus is to continue to assist with any cleanup efforts here, to further contain the leak and to ensure that the health, safety and welfare of the public remains paramount," Joe Durso of NJ Transit said.
The oil runs for approximately three to four miles and ends just below Blackwood Lake.
Health officials are monitoring the situation.
Many people have private wells in the area, but because there are no surface water intakes in the area, they say there are no reasons to believe the wells will be affected.
It's a different story for wildlife.
Animal rescue crews led by the Tristate Bird Rescue collected dozens of waterfowl who were covered in oil and struggling to move.
Environmental experts from the state DEP say diesel fuel is a light fuel that floats on the surface and can evaporate. They don't expect long term damage to the lakes and creek.
New Jersey Transit says the leak is contained and no more fuel is going into the water.
