On Monday the Australian Defence Force removed the helicopter 'Lucy' that crashed into Eden dam.
The helicopter belonged to Armidale's Fleet Helicopters owner Lachie Onslow who was the pilot at the time.
It was still submerged in the dam on Friday afternoon, which is a source of drinking water for Bega Valley Shire residents, a council spokesman said.
"Booms are in place to limit the potential spread of contamination," he said.
"Once the helicopter is retrieved [the] council can do assessments of the water in the dam.
A borefield is in operation to supply water to Eden residents.
HELICOPTER pilot Lachie Onslow has escaped without serious injury after his helicopter crashed into a dam while fighting fires on the far south coast.
The owner of Fleet Helicopters in Armidale has contracted his well-known pink helicopter 'Lucy' to help the NSW Rural Fire Service battle the Clyde Mountain fire.
The 47-year-old was flying the helicopter when it ditched into a dam in the Ben Boyd National Park at Edrom, in the Bega Valley Shire about 4pm on Thursday afternoon.
The aircraft remains submerged, however Mr Onslow was able to free himself from the helicopter and make it safely onshore.
Ambulance responded to the incident but Mr Onslow managed to escape without serious injury, he was treated by paramedics for shoulder, back and ankle injuries and taken to the South East Regional Hospital in a stable condition.
Mr Onslow will return to Armidale in the next couple of days.
An RFS New England Aviation Brigade spokesperson said the event was a sobering reminder of the dangers faced by brave pilots on a daily basis.
"It is with both sadness and relief that I can confirm that the helicopter that crashed this afternoon was 'Lucy' VH-ONZ belonging to Fleet Helicopters based here in Armidale," the spokesperson said.
The reservoir the helicopter crash in is a drinking supply for Bega Valley Shire Council, police are investigating the incident.
HAZMAT crews confirmed no fuel or oil had leaked from the helicopter about 7pm on Thursday.
Recovery efforts are expected to begin on Friday.
Mr Onslow is known as an expert pilot, having competed in the Reno Championship Air Races.
More people have been to space than have competed in the air race, that sees pilots cover the distance of two football fields a second, at 800 kilometres an hour.
There's nowhere in the world pilots can fly that fast under 10,000 feet, except at the competition.
It's one of the fastest and most dangerous motorsports in the world.