Officials in New Zealand say that some 350 tons of oil may have already leaked from the 775-foot Liberia-flagged Rena, which ran aground on the Astrolabe Reef last Wednesday.

As the oil began washing up on the beaches of Mount Maunganui and Papamoa, Environment Minister Nick Smith said the situation will get significantly worse in the coming days.

This event has come to a stage where it is New Zealand's most significant maritime environmental disaster, he told a news briefing in Tauranga on Tuesday.

The government is determined to throw everything possible at minimizing the environmental harm of what is now clear to be New Zealand's worst environmental disaster in many decades.

Response teams leapt into action to battle the oil that is spilling out of the stranded cargo ship. Meanwhile, residents were warned to stay away from the shore and not touch the heavy globs of oil, which authorities say are toxic.

Authorities claim the crisis will take weeks or months to tackle, rather than days. With 1,700 tons of oil onboard - and fuel continuing to leak from the vessel - a wildlife response center has been set up to clean the oiled birds.

About 200 people are involved in the salvage operation, while 300 military personnel are on stand-by to clean up beaches.

Yet, the biggest question remains: why did a vessel carrying 1,700 tons of oil hit a well-known reef in calm waters?

Have a look at the devastating damage in the photos below:

NZ Oil Spill 2
Containers from the 47,230 tonne Liberian-flagged Rena float next to it after falling from the deck, about 12 nautical miles (22 km) from Tauranga, on the east coast of New Zealand's North Island October 12, 2011, a week after hitting the Astrolabe Reef. The captain of the Rena has appeared this morning in the Tauranga District Court over the incident and has been remanded on bail, and about 70 containers fell from the vessel amid heavy seas last night, according to Maritime New Zealand. REUTERS
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A volunteers removes thick fuel-oil from the stricken container ship Rena washed up on beaches at Papamoa, near Tauranga October 12, 2011. The 47,230-tonne Liberian-flagged Rena has been stranded on a reef 12 nautical miles off Tauranga on the east coast of New Zealand's North Island since running aground a week ago and authorities estimated 300 tonnes of oil have escaped from the ship, causing the country's worst environmental disaster in decades. REUTERS
NZ Oil Spill 4
Volunteers remove thick fuel-oil from the stricken container ship Rena washed up on beaches at Papamoa, near Tauranga October 12, 2011. The 47,230-tonne Liberian-flagged Rena has been stranded on a reef 12 nautical miles off Tauranga on the east coast of New Zealand's North Island since running aground a week ago and authorities estimated 300 tonnes of oil have escaped from the ship, causing the country's worst environmental disaster in decades. REUTERS
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Volunteers remove thick fuel-oil from the stricken container ship Rena washed up on beaches at Papamoa, near Tauranga October 12, 2011. The 47,230-tonne Liberian-flagged Rena has been stranded on a reef 12 nautical miles off Tauranga on the east coast of New Zealand's North Island since running aground a week ago and authorities estimated 300 tonnes of oil have escaped from the ship, causing the country's worst environmental disaster in decades. REUTERS
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Conservation officials remove dead seabirds as thick fuel-oil from the stricken container ship Rena fouls beaches at Papamoa, near Tauranga October 12, 2011. The 47,230-tonne Liberian-flagged Rena has been stranded on a reef 12 nautical miles off Tauranga on the east coast of New Zealand's North Island since running aground a week ago and authorities estimated 300 tonnes of oil have escaped from the ship, causing the country's worst environmental disaster in decades. REUTERS
Wildlife Massacre in NZ Oil Spill
A volunteer looks at dead seabirds on the shore as thick fuel-oil from the stricken container ship Rena fouls beaches at Papamoa, near Tauranga October 12, 2011. The 47,230-tonne Liberian-flagged Rena has been stranded on a reef 12 nautical miles off Tauranga on the east coast of New Zealand's North Island since running aground a week ago and authorities estimated 300 tonnes of oil have escaped from the ship, causing the country's worst environmental disaster in decades. REUTERS
Oil Spill Oil Spill