Forty five children living in the Australian mining town of Mount Isa, where Xstrata Plc produces 4 percent of the world's lead, have unsafe blood lead levels above World Health Organisation standards, a report said on Thursday.

Swiss-based Xstrata and local and state governments are facing legal action from the parents of a six-year-old Mount Isa girl who has suffered injuries to her brain and nervous system, allegedly linked to lead exposure from the town's mine.

Xstrata said on Wednesday that it welcomed the report along with moves to reduce lead contamination in Mount Isa.

The Queensland state health department study, which examined 400 children, confirmed preliminary findings released last month that identified high blood lead levels in the children.

It found that 45 children, aged one to four, had lead levels greater than the WHO's recommended safe level of below 10 micograms per decilitre. One child had three times that level. The average lead level in the 400 was 5 micograms per decilitre.

Blood lead levels of 10 micrograms per decilitre and above can be toxic in children and impair cognitive development.

The report said lead occurred naturally in the soil around Mount Isa and was emitted from the mining operation. Mount Isa town, about 1,300 km (800 miles) northwest of the Queensland city of Brisbane, sits directly adjacent to Xstrata's zinc, lead, copper and silver mining operation.

Outside the actual Mount Isa mining area there is a low grade periphery of the lead-silver-zinc orebody that extends into some community areas, it said.

The report found that 90 percent of the children with high levels had played in bare soil, 77 percent had pets which were exposed to dust, 70 percent chewed or ate non-food such as soil and 42 percent sucked their thumbs.

These factors have been consistently reported to be associated with elevated blood lead levels in children in studies at other locations, it said.

London-listed Xstrata acquired the Mount Isa operations, a complex of mines and smelters churning out millions of tonnes of copper, lead, zinc, coal and silver, when it bought MIM Holdings in 2003. In 2006, Mount Isa produced 210,000 tonnes of zinc in concentrates and 120,000 tonnes of lead in concentrates.

The report recommended continued monitoring of blood lead levels, further dust control measures and education, and a follow up test in 2012.

Xstrata said it supported further monitoring and urged Mount Isa parents to have their children tested.

We are committed to continuing to work ensure the health and well-being of our children (in Mount Isa), said Steve de Kruijff, chief operating officer with Xstrata Copper North Queensland.

Xstrata currently operates 15 lead monitoring stations around the town and is removing old mine sediment that has contaminated the nearby Leichhardt River.

Concerns over lead contamination forced another international mining company, Ivernia of Canada, to idle its Magellan lead mine in Western Australia after lead residue was blamed for killing thousands of birds. (Reporting by Michael Perry; Editing by Richard Pullin and Roger Crabb)

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