A leaching tank containing the contaminated slurry burst at about 1am this morning, apparently with such force that it bent a crane and other infrastructure nearby at the Ranger mine.

Justin O'Brien, CEO of Gundjeihmi Aboriginal Corporation representing the site's traditional owners, said the acid had contaminated a large area of the work site, overtopped a low bund and entered a storm drain.

"A million litres of radioactive acid burst out of a tank at such a velocity that it damaged all the infrastructure nearby," he said.

"We are advised that the spill will make that part of the mine, which is the heart of the operation, inoperable for at least a month or two."

The Ranger mine's operator, Energy Resources of Australia, confirmed the tank failure.

"Upon discovery of a hole in the side of the tank, personnel were removed from the nearby area before the tank failed and a mixture of slurry escaped," ERA said in a statement.

"The slurry moved outside the bunded containment area, but has been captured and contained on site. As the material was contained within the processing area there is no impact on the environment surrounding the Ranger Project Area."

A spokeswoman said workers had been evacuated and production shut down, but was unable to confirm how much material had spilled or what damage had been done. There had been no injuries.

Mr O'Brien said a jet of fluid had been discovered spraying from the side of the leaching tank at around 12.30am this morning. He said workers were trying to use a crane to lower a piece of steel to stop the flow when the initial hole expanded and another developed.

"The 10 to 20 people who were working on it were asked to evacuate," he said.

"Thank god they did, because the whole thing burst apart with such velocity that it bent all the metal walkways around about, damaged the bund, bent the crane and smashed the windscreen of the crane."

The incident could not have come at worse time for ERA, which recently ceased open-cut mining and is now seeking approval to develop its newly discovered Ranger 3 Deeps deposit underground.

The Ranger 3 Deeps resource is believed to be one of the world's best underdeveloped uranium deposits, containing around 10 million tonnes of ore that is expected to yield 34,000 tonnes of uranium oxide.

The federal government is presently considering whether to grant ERA approval for a new underground mine.

Traditional owners have so far maintained an "open mind" on the proposal, but Mr O'Brien said two breaches of the company's radiation plan and now a major radioactive spill in under a year was undermining that goodwill.

"That openness is diminished day by day, incident by incident," he said.

The ERA site is separate from but entirely within World Heritage-listed Kakadu National Park. Mr O'Brien said that with the heaviest rains of the wet season approaching, traditional owners feared the radioactive acid could be washed downstream.

The site is close to the Magita Creek, which is now flowing, and about 7km upstream from the Aboriginal community of Mudgunberri where about 60 people live.

"We understand the spill entered a stormwater drain. We have been advised that it went no further, and has been contained within that part of the stormwater drain. Well, let's see," he said.

He described the mine as a "hillbilly operation", and demanded the federal government seek advice outside Australia before making a decision on whether to approve the Ranger 3 Deeps underground development.

A spokeswoman for ERA, which is majority owned by mining giant Rio Tinto, promised further updates later in the day.