Incitec Fertilisers, an arm of Incitec Pivot, has submitted an application to the State Government for the first of a four-phase, $18.6 million rehabilitation program.

The 15-hectare site at 13 Main Road, Boolaroo, has been used by heavy industry since 1890.

A superphosphate plant was established in 1913 to utilise by-products from the neighbouring Pasminco zinc and lead smelter.

The company plans to decommission its operations on the site early next year.

A preliminary environmental assessment of the area done in February 2007 as part of the company's voluntary remediation plan noted the area's soil was heavily contaminated.

"Soil studies have identified high concentrations of heavy metals, phosphorous and sulphate at the site," the report said.

"Heavy metals include cadmium, copper, lead and zinc, all of which have potential for leaching."

Groundwater was also contaminated with heavy metals.

"The heavy metals most prevalent include zinc and mercury, with concentration levels well in excess of the [Australian and New Zealand Environment and Conservation Council] criteria for marine waters."

High levels of groundwater contamination were found in areas surrounding large volumes of slag material.

Incitec Pivot has proposed to extract all contaminated soil from the site and place it in 200,000-cubic-metre lined container cells.

Groundwater will be extracted via several wells before it is treated on site.

The company also plans to demolish and remove asbestos from existing buildings on the site at a cost of $2.5 million.

It is estimated the demolition works will take six to eight months while soil and groundwater remediation will take about 18 months.

The company's environmental assessment for the project will remain on public exhibition until December 22.