Residents in Otago towns Karitane and Waikouaiti anxiously awaiting blood test results after toxic lead levels found in water

Residents in two Otago towns are undergoing blood tests after traces of lead 40-times the acceptable level was detected in the water.

There are 1500 residents in Karitane and Waikouaiti - the two areas affected by the contamination - and all have been offered free blood tests for assurance. 

There's mounting concern from locals, including Waikouaiti residents Rachel and Richard Olsen who just celebrated the safe arrival of their baby, Gretel.

"You look at her and try to be happy but you're filled with dread really, just about what the future might hold," Rachel says.

Rachel had a blood test on Friday morning after following concern over the effects of lead in their water. Baby Gretel will have one next week.

"It's made me quite anxious about the whole pregnancy and everything, because I know I was drinking a lot of water through summer and kept hydrated for her," Rachel says.

"And now that I know it goes back as far as August, like, it's nearly my whole pregnancy potentially that I could have been ingesting this water."

The couple is frustrated and angry over a lack of transparency from the Dunedin City Council.

"It's like we are test dummies out here for the council really, and they're just doing what they want to do with no repercussions for the residents out here," Richard says.

Dunedin Mayor Aaron Hawkins only learned of miscommunication in how high the lead levels spiked while on RNZ's Checkpoint programme on Thursday.

Initially, he believed lead levels were four-times what was acceptable, but when asked if he knew it was actually 40-times, he said "I did not know that".

The Council recorded six elevated lead spikes in the towns' water supplies between last August and January.

"And on each of those occasions, those results were presented to public health authorities, and our staff followed their advice. Which until Tuesday morning didn't include a 'do not drink' notice," Hawkins told Newshub.

Six water tankers are spread across the two towns, with container sizes steadily increasing as the situation drags on.

"We're not told if this is going to go on for weeks, months, years it is a worry," Waikouaiti resident Blair Powell says.

Prime Minister Jacinda Ardern says the Government is keeping an eye on things there.

"Obviously what's happened there - unacceptable. We have a commitment that they will be provided with safe drinking water until it can be established what has happened with lead levels in that area."