THE green light has been given for a test bore to be drilled in search for a new water supply for the town of Bell.

The Western Downs town has been on strict water restrictions for several months and council is hoping they may have found a new water source.

Council spokesman for utilities Peter Saxelby said preparations were being made for the test.

"The State Government has given us approval to put a test bore down... we are currently putting out the tenders for the bore drilling,” Cr Saxelby said.

"There is apparently better conductivity water than they currently have in the bore they are using now.”

The location for the test bore has not been disclosed, however Cr Saxelby said the state government had confidence of success.

The Department of Natural Resources has indicated previously that there has never been a great artisan bore drilled near Bell, but there is evidence it runs under the Bunya Mountains.

The main bore at Bell Racecourse was drilled in 2000, and was hoped it would solve Bell's water issues.

A decline in water flow was noticed in 2004, and progressively worsened over the next decade.

Cr Saxelby said residents of the town had been excellent during the recent water restrictions.

"Currently we are giving about (the town) 155 kilolitres a day of treated water and the people out there are currently using about 63 kilolitres a day,” he said.

"On Peak days it is about 130 kilolitres they would use.”