The Aurul SA gold plant in the northern Romanian town of Baia Mare, half-owned by Australia's Esmeralda Exploration Ltd , said that cyanide slurry leaked from its tailings dam two weeks ago, but has said the damage has been exaggerated.

Esmeralda has said the environmental disaster along the Tisza and Danube rivers in Hungary and Yugoslavia was caused by cold weather, not the January 31 cyanide spill in Romania.

On Tuesday, Hungarian Prime Minister Victor Orban said Budapest was developing a basis for suing the Romanian government, the Aurul smelter and its Australian parent.

"I don't see the logic of talking about suing as long as we do not have the results of the evaluation. This would be a purely political act, a regrettable one at that," Roman said.

"Romania will fully respect international legal provisions, but I appeal to the Hungarian colleagues and politicians not to try to turn this matter into a political issue, because it serves nobody," he added.

Experts were assessing spill damage and European Commissioner for Environment Margot Wallstrom was expected to visit Hungary and Romania on Thursday.

Fotiadis said experts from the European Commission as well as from EU member states were available to help assess the damage and provide other assistance.

He said Wallstrom aimed to "assure herself that the dialogue and cooperation between the two countries (Romania and Hungary) is moving harmoniously" and to get a first-hand view of damage.

Romania on Wednesday banned water intake and fishing on its stretch of the Danube and warned neighbouring countries that the poison was moving slowly downriver.

The Romanian Environment Ministry said the cyanide had reached the reservoir of the Iron Gates hydroelectric plant on Wednesday and was moving at three km (two miles) per hour.

It also said the cyanide concentration was expected to drop significantly over the next 24 hours.

"So far, there have been no dead fish, birds or other animals," the ministry said, quoting levels of 0.33 milligrams per litre, or 33 times the permitted level, when the spill reached the Romanian section of the Danube early on Tuesday.