Arrow Energy has issued a press release this morning reporting what it terms a "a gas release incident" from a future production well in its Daandine field, approximately 25 kilometres west of Dalby.
The gas leak happened at 9am yesterday. Witnessed said it initially shot gas and coal seam water up to 90 metres in the sky.
Emergency services workers have set up an exclusion zone and are currently trying to bring the flow under control.
The statement said there had been no injuries.
Arrow Energy the infrastructure and well was undamaged and retained full integrity above and below ground, the company said.
The indicident happened at 9am yesterday.
Arrow said its contractors were preparing to install a down-hole pump into a new well, which is a routine activity to bring it into gas production.
Its press issued this morning said:
"After initial checks, the well was uncapped in order to install the pump.
"Before this could occur water and gas began to flow to surface with increasing intensity.
"In accordance with standard procedure, the contractor crew moved a safe distance from the well and advised Arrow personnel.
"The site has been secured and local emergency services have been advised.
"An Arrow Energy incident response team and drilling engineers have put in place a plan to stem the gas flow. The standard method in this situation involves filling the well with dense drilling fluids
(water based drilling muds).
"The weight of these fluids acts to prevent the gas flowing to surface.
"We expect the matter will likely be resolved within the next two to three days.
"Arrow has notified the government regulators (DERM and DEEDI) as well as the landholder and local council.
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