Eight villages are completely or partly submerged, with homes and more than 20 factories buried to the rooftops. Some 13,000 people have been evacuated. The four-lane highway west of here has been cut in two, as has the rail line, dealing a serious blow to the economy of this region in East Java, an area vital to the country’s economy. The muck has already inundated an area covering one and a half square miles.

And it shows no signs of stopping.

The mud is rising by the hour, and now spewing forth at the rate of about 170,000 cubic yards a day, or about enough to cover Central Park.

Foreign companies, environmental groups and political observers are now watching closely to see whether the government will hold the company that drilled the well accountable for the costs of the cleanup, which could easily reach $1 billion.

The company is part of a conglomerate controlled by Aburizal Bakrie, a cabinet member and billionaire who was a major contributor to the campaign of President Susilo Bambang Yudhoyono.

The disaster occurred as the company, Lapindo Brantas, drilled thousands of feet to tap natural gas and used practices that geologists, mining engineers and Indonesian officials described as faulty.

But as the liabilities have escalated, Lapindo was sold — for $2 — last month to an offshore company, owned by the Bakrie Group, and many fear it will declare bankruptcy, allowing its owners to walk away.

Mr. Bakrie declined to be interviewed. A spokeswoman for Lapindo, Yunawati Teryana, said that it was too early to conclude that Lapindo had acted negligently. She noted that some geologists had said this was a natural disaster, a natural mud volcano, perhaps set off by seismic activity in the area.

Government officials and company engineers are not hopeful that they can contain the problem. In what Indonesian officials describe as the best of the worst options, the government plans to pump the mud into the Porong River, which flows into the sea 20 miles north of here.

“It will be the death of the ecosystem around that area,” said Amien Widodo, an environmental geologist who teaches at the November 10 Institute of Technology in Surabaya. There is debate whether the mud is toxic. But the sheer volume alone will smother just about everything in its path, he said.

The area’s commerce has already been devastated.

“We are angry because we were living comfortably in our own home and now we are forced to leave,” Reni Matakupan said as she stood here looking across 200 yards of mud at her family’s factory, DeBrima, which was filling with mud.

The problems began in late May when the company had reached about 9,000 feet, Mr. Widodo said. It continued to drill to this depth even though it had not installed what is known as a casing around the well to the levels required under Indonesian mining regulations, and good mining practices, he said.

The company experienced problems with the drilling that led to a loss of pressure in the well. That is when the mud started seeping in from the sides of the unprotected well bore, at a depth of about 6,000 feet.

The mud was stopped by cement plugs that the company had inserted into the well hole. The mud then sought other avenues of escape, eventually breaking through the earth, and creating mud volcanoes in several places that resemble the geysers of Yellowstone.

If the proper casing had been in place, the mud would not have entered the well, Mr. Widodo said, and would not have discovered these other avenues to the surface, a conclusion supported by mining engineers. Several Western and Indonesian mining engineers spoke about the matter, some offering graphs and mining details that have not been made public, but only on the condition that they not be identified, for fear of running afoul of Mr. Bakrie, the billionaire company owner.