Response teams are currently in the Placentia Bay area working to contain a spill from the Come By Chance refinery.
North Atlantic, which operates the refinery, says its operations team first discovered a leak coming from a pipe at its dock, or 'jetty' on Monday.
It says crude oil and water came out of a broken section of pipeline and leaked into the waters of Placentia Bay.
The company said the leak was stopped within an hour of the discovery and the company's response team deployed a containment boom and immediately started clean-up in the area.
To help with the efforts, the Eastern Canada Response Corporation (ECRC) was contacted Monday. The team can't do assessments in the dark, so it didn't start working until daybreak on Tuesday.
After a day-long search of Placentia Bay, ECRC found oil on the shores near Bordeaux, which is six kilometres southwest of the refinery.
Gloria Warren-Slade, communications manager with North Atlantic, said the company is not sure how long the oil was leaking into the bay, but said inspections are done on the pipes at least every hour or two.
Warren-Slade said after the leak was discovered, all of Placentia Bay was assessed, which is when the oil was found at Bordeaux.
High winds causing problems
The statement goes on to say that high wind conditions in Placentia Bay are hampering the response, but ECRC is still there trying to contain the oil, and to plan future clean-up work.
"This is a very concerning incident for us. Protecting the environment is a critical part of our operation and a responsibility that we take very seriously," wrote refinery manager Dan Harris in a statement.
"We are working closely with ECRC to manage this situation and return the impacted area to its original state. An investigation into this incident is progressing aggressively to help us determine the cause of the event and establish safeguards needed to prevent a reoccurrence."
North Atlantic says it will provide updates as the clean-up work continues.