As engineers work to prevent a second wave of toxic sludge from overwhelming several towns in western Hungary, the government warned nearby residents the industrial plant reservoir may collapse at any time.

Fearing a second wave of sludge will be more concentrated, and therefore even more toxic, than the first deluge that killed seven people this week, nearly 800 residents of nearby Kolontar have been evacuated. Others have been ordered to be ready to evacuate at a moment's notice.

Prime Minister Viktor Orban said the northern wall of MAL Rt.'s storage pool, which released at least 700,000 cubic metres of caustic red sludge when one of its corners ruptured on Monday, was showing numerous cracks and seemed ready to fail completely.

"Because it may happen at any moment, but it's also possible that it won't happen ... there's only one thing we can do -- we have to behave as if this could happen any minute," Orban told reporters in Budapest. "There's no technical equipment that could really stop this process and the only thing we can do is prepare ourselves to stop the damage it would cause."

Monday's deluge sent nearly 700,000 cubic metres of polluted water and mud into three villages within one hour. At least seven people were killed, hundreds of people and animals injured and dozens of homes were washed away.

Another 500,000 cubic metres of red sludge could escape the reservoir if the cracked wall collapses, Orban said Saturday, though he admitted it is difficult to determine a precise figure.

"We have no exact information about the nature of the material because a catastrophe like this has never happened before anywhere in the world," Orban said. "We have only assumptions about how far and with how much force the material can come out of the storage container."

Red sludge is a byproduct when bauxite is refined into alumina, which is used to make aluminum. Treated sludge is commonly stored in ponds, which allows the water to evaporate, leaving behind a red clay that poses no health hazard. Experts speculate the sludge in Hungary was not adequately treated, leaving the mixture highly toxic.

The sludge has poured into creeks and rivers and made its way to the Danube River Thursday, heading downstream to Croatia, Serbia and Romania.

Chemical analyses show that levels of toxic heavy metals in the water that spilled into the Danube are at the level allowed in drinking water.

The pH level of the water where the sludge hit the Danube was under 9, below the 13.5 measured in local waterways near the reservoir.

While the measurements indicate there will be little environmental damage far from the spill site, the local waterways and villages hardest hit by the spill face unknown biological catastrophe.

Crews rushed to build barriers in front of the collapsed wall and have started to construct dams on the north side, towards low-lying villages.

Officials with MAL Rt., the company that owns the plant, have not said why the walls, which are made of concrete, are cracking.

In addition to the evacuation of Kolontar, officials are considering ordering residents of Devecser, about 4 kilometres further north, to leave.

Resident Maria Gyori said her son's family has asked her to join them at their home 55 kilometres east of the village, but she is hesitant to leave.

"My husband and I want to stay until the very last moment and even then I'm not sure we'll leave," the 79-year-old said. "If another wave comes, I was thinking of standing on top of the kitchen table. Maybe the sludge won't go that high"

Hungarian police have opened an investigation into the incident and have confiscated documents from, and interviewed officials with, MAL Rt.

Orban said Saturday that "human errors and mistakes" played some role in the incident, and indicated that "someone has to answer for this."

He said a request from MAL Rt. to resume operations at the plant will not be granted until his cabinet meets on Monday.

With files from CTV's Tom Kennedy and The Associated Press