The activities in the petroleum industry extend from the exploration stage to production, transportation, refining, storage and consumption. Among these activities exploration stage is of shortest duration; however the chemicals used and cuttings brought to the surface during drilling must be taken care of appropriately. Production from oil fields may last more than 50 years and produced waters together with oil, if processing or injection back into underground formations is not done properly, may become a nuisance to the environment. Surface or underground water resources are at risk if caution is not practiced. Oil spills on surface waters such as rivers, lakes, and sea under go several processes of change and complex series of physical, chemical and biological processes are active. These processes alter the oil and partition it between atmosphere, water surface, water column, sediment and shore. Spills vary depending on oil type and weather conditions. It is accepted that evaporation, spreading, dispersion, emulsification and mousse (water in oil emulsion) formation and biological degradation are the main mechanisms that control the fate of an oil spill. Underground water formations also are affected from oil activities if proper handling of produced waters is not practiced. In this paper, a field case study from a Turkish oil field operated by N.V. Turkse Shell Company is presented. Oil field production waters were injected into an underground water reservoir for more than 25 years. The effect of this activity was studied at the Petroleum Research Center, Middle East Technical University which started in 1997. During the study, 8 observation wells were drilled in the region, 6 of which were in the project area. Core and water samples and log data were obtained from the observation wells drilled. Underground water budget data and recharge points were obtained from already existing reports and these were used in modelling of the water movement in the aquifer. Contaminant transport was studied by following the NaCl concentrations which were available from the analysis of samples collected from the observation wells. The oil concentration in collected water samples' also was determined which was accompanied by fingerprint analysis for the crude oil. The results indicate that contaminant front had moved 18.7 kilometers towards the city where aquifer is used as the source of drinking water. It is predicted that in 40 years time the 25 ppm NaCl (allowable limit for drinking water) contaminant front will reach the city which is 33 km south east of the oil field.