Williams County Emergency Management Coordinator Mike Hallesy said that trying to douse the blaze at Red River Supply could cause chemicals to drain into the Little Muddy River and canals.
Officials said there were reports of an explosion late Monday or early Tuesday at the company, which provides services and supplies in the North Dakota oil patch. Early Tuesday, flames rose hundreds of feet into the air as the fire spread.
In the morning, a pall of heavy black smoke spread over the area.
A voluntary evacuation was declared for a half-mile around Red River Supply. Hallesy said that could be extended to a mile if the wind shifts.
The company said no one there was injured. The cause of the fire had not been determined Tuesday.
Williston is a town of more than 14,000 people that has grown considerably with the oil boom.