The 1998 Sydney water crisis involved the supposed contamination of Sydney's main water supply, the Warragamba Dam, by the microscopic pathogens cryptosporidium and giardia between July and September 1998.
Low levels of cryptosporidium and giardia were first detected in the water supply on 21 July. The levels were within acceptable health limits. In days following, much higher levels were recorded, and on 27 July the first "boil water" alert (in which residents were instructed to boil their tap water before use) was declared for the eastern Central Business District (CBD). On 29 July a "boil water" alert was issued for the south of Sydney Harbour and on 30 July a Sydney-wide "boil water" alert was issued.
The Sydney Water Corporation announced the water safe to drink again on 4 August.
The contamination was caused by low-quality raw water entering the dam. This was attributed to moderate rainfall in July, followed by heavy rainfall in August and September (after decreasing storage levels since mid-July 1997) which caused pulses of the raw water to enter the dam.
The incident was highly publicised and caused major public alarm. Three successive "boil water" notices in which residents were instructed to boil their tap water before use affected up to three million residents.
The lack of cases of cryptosporidiosis, giardiasis or any other health problem which might be attributed to tainted water led to suggestions the microbes were either not an infectious type, or not as prevalent as measured. An inquiry after the event revealed the publicity as an exaggeration of fact, with Australian Water Technologies, part of Sydney Water, severely overestimating levels of cryptosporidium and giardia present in the water, with the recorded levels exposed as not harmful to human health. The handling of the crisis by Sydney Water, a state-government owned corporation since 1995, was heavily criticised, causing the resignation of both the Chairman and the Managing Director and bringing up issues of private vs. public ownership and scientific uncertainty.
A state-sponsored examination, the Sydney Water Inquiry, was established in August the same year. Chaired by Peter McClellan, QC, the final report was delivered in December 1998.
The Sydney Catchment Authority was created in 1999 as result of the crisis, assuming control of Sydney's catchments and dams, while Sydney Water maintained responsibility for water treatment and distribution and for sewage collection, treatment and disposal.
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