A MINING company under scrutiny over lead contamination acknowledges lead dust from its Wiluna mine escaped into Esperance, but maintains it did nothing wrong.

More than 4000 birds have died from lead poisoning around the southern West Australian port town since December, and 13 residents – including two infants – have recorded high lead levels in their blood.

High readings of lead and nickel have also been found in rainwater tanks around Esperance.

A parliamentary inquiry is looking at why mining company Magellan Metals transported and exported lead carbonate through Esperance Port in a powdered form rather than in pellets.

In its submission to the inquiry today, Magellan Metals said it recognised lead carbonate from its mine transported through the port had escaped into the town.

"Any escape into the environment is totally unacceptable," Magellan said.

But it said the lead was transported and handled in accordance with the terms and conditions imposed by its mining licence, the port's licence and Magellan's agreement with the port.

Magellan Metals said it never told licensing authorities it would export lead carbonate in pelleted form.

It told authorities that the transportation would be in moist agglomerates (accumulations of large blocks of material).

But when the mineral was transported the hundreds of kilometres from the Wiluna mine to Esperance, the agglomerates dried up and reverted to powder, it said.

"Magellan decided to discontinue use of the equipment for forming agglomerates and informed the Esperance Port Authority of this in writing on 7 April 2005."

This was almost three months before the company entered into an export agreement with the Esperance Port Authority.

The inquiry is due to report back to the Legislative Assembly by August 16.