The city of Iqaluit says an old underground spill is likely responsible for fuel that is contaminating the communities tap water.
City officials released news on Tuesday that they found signs of historic spill next to the water treatment plant in an inaccessible hole in the ground.
The capitals water has been undrinkable even if boiled since October 12, when traces of fuel were found in the plant.
The city of about 8,000 people has been in the state of emergency since then and thousands of bottled water had been flown in. Testing is now being done to confirm the spill is the source of contamination.
The city has reported to Nunavut Government and hired a professional firm to clean it up. A site remediation plan is also on the way.
There is still no timeline for when the city residents will be able to drink their tap water again.
The Canadian Armed Forces arrived in Iqaluit last weekend to help with ongoing emergency.
The military has said it will set up reverse osmosis water purification units in the city but is still in the process of testing water of proposed sites.