An Orica spokeswoman said there was a small overflow of weak ammonium nitrate solution from a tank bund this afternoon.
The Environment Protection Authority (EPA) has been been informed of the incident.
The EPA contacted Fire and Rescue NSW Hazmat (Hazardous Materials) and crews are on the scene.
FRNSW said they are working with Orica management to contain the spill and there are no reports of injuries.
The EPA said the quantity of solution is believed to be around 20,000 litres with some spilling over a bund surrounding a tank, soaking into the ground.
The Orica spokeswoman said the solution was equivalent to garden fertiliser.
She said there is no risk to the public.
This incident was not part of the re-start of the nitric acid plant or pre-start up pressure testing being undertaken on site.
New South Wales Health has also confirmed there is no public health risk based on current information.
NSW Environment Minister Robyn Parker has been advised of the incident.
"Orica have reported that the incident occurred during pumping operations between tanks and the auto shut-off is believed to have failed," she said.
She added that the incident is contained on site and there is no environmental risk.
Orica has ceased operations at the plant following the incident.