Customs officers have uncovered a substantial diesel laundering plant 15 miles south of the Border.
It is understood the diesel was being smuggled across the Border and sold through garages to unsuspecting motorists who paid full price.
Revenue officers from Dundalk and Clones found the plant yesterday near the village of Kilsaran, approximately halfway between Drogheda and Dundalk.
It was in the process of laundering up to 40,000 litres of diesel when it was raided at around 8 a.m.
"The significance of this detection is its location. It is not at a land frontier and this is due to the success of our officers in Dundalk, who have closed down a considerable number of operations along the Border forcing those involved to move on," said a customs source. The seizure also left environmental staff from Louth County Council with over 11,000 litres of residue, which have to be disposed of in accordance with the Waste Management Act. It will probably have to be exported to Europe to a company that treats hazardous waste.
The plant, which was located in a large shed, had an automated switching system that allowed it to be turned on and then left unattended for up to 18 hours. It was on land belonging to a farmer who had leased the shed.
A large quantity of caustic soda and 1,000 litres of sulphuric acid were recovered.
Customs officers believe it had been operating for up to five weeks and was capable of washing up to 40,000 litres of diesel a day, a potential loss to the exchequer of €600,000 a year.
One man is helping Customs officers with their inquiries.