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There is concern asbestos fibres from houses destroyed in the Warrumbungles fire near Coonabarabran in north western New South Wales may have spread.
Visual assessments carried out at 36 properties have found 31 of them contain asbestos.
A public works committee is now working on a management plan of how to dispose of the material.
But the general manager of the Warrumbungle Shire, Steve Loan, says more testing needs to be done because visual assessments are not enough.
“The danger we’ve been told now is that asbestos when its burnt goes into a very fine, friable sort of a nature and it actually de-laminates and it becomes almost invisible,” he said.
“If it’s really dry, as it was just after the fires, it can blow around and cause all sorts of problems and get into your respiratory systems.”
Mr Loan says a public works committee is now working on an asbestos management plan.
“Two or three sheets of asbestos in one large building can contaminate the whole site,” he said.
“So what they’ve got to try and do now is work out whether or not it’s appropriate to try to separate the asbestos contamination on site, so that it’s a fairly minimal amount that they transfer.
“Or whether or not the whole lot’s got to come into town.”
An asbestos disposal site at the town’s tip has been identified.