The City of Greater Bendigo is seeking to use evaporation ponds at Woodvale as a short-term solution to rising groundwater problems.
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It has asked the state government to enable it to use the evaporation ponds at no cost to council.
A report to be tabled at Wednesday’s council meeting states that groundwater levels are continuing to rise across the mine workings under Bendigo as a result of Unity Mining’s decision to cease pumping water to Woodvale.
Chief executive Craig Niemann said the council was "relatively confident" the government would grant the council its request.
"(Council) has been in discussion with the number of stakeholders involved," he said.
"We've been working on this for quite a while."
The water has high levels of salt, arsenic and other metals and it is expected that surface discharge could occur as early as January.
Mr Niemann said if a solution wasn't determined, the water could reach the surface and discharge into the Sydney Flat Creek, which is connected to Myers Creek, the Bendigo Creek and Kow Swamp.
Bendigo’s groundwater levels have been managed by Unity Mining and its predecessors over the past couple of decades through their need to pump water to Woodvale to enable further exploration for gold extraction under Bendigo.
However, Unity Mining has now ceased its operations and stopped pumping water to Woodvale.
Mr Niemann said the council was yet to determine a long-term solution to the problem, but was exploring a range of options.
