Access to natural gas by about 1,000 homes and businesses across Bundaberg have been cut off after Envestra Limited announced a portion of its natural gas pipeline servicing the area had been damaged.
This transpired as authorities cautioned North Bundaberg residents it is not yet safe to return to their homes.
"There may well be people who may have drowned," Superintendent Rowan Bond told reporters in Bundaberg on Thursday.
"It's just terrible if we allowed people to go in there and be confronted with scenes like that."
He advised residents to let them finish off their work first before they come into the scene.
A "large number" of people have been reported missing in the Bundaberg area, Superintendent Bond said.
"Because there was a rapid mandatory evacuation, people have actually been ... separated from their family with possibly no way of contacting," he said.
Queensland's second flooding history in a span of two years had claimed six lives according to reports.
An exclusion zone has been set up in North Bundaberg and people have been advised to stay outside that area.
"We've got police in the area to enforce that. We just don't know what the situation is there but we do know there's quite extensive damage in the area," a certain Mark Jackson from the district disaster group was quoted by the ABC.
"It's not a safe place to be so we're seeking peoples' cooperation not to be in that area."
Meanwhile, Envestra Limited, one of Australia's largest natural gas distribution companies, said the damage to its natural gas pipeline was found at the point where it crosses the Burnett River, north of Bundaberg in southeast Queensland.
"Emergency crews have been sent to the region and are making preparations to carry out the repairs as soon as safe access can be gained to the damaged pipeline," Ian Little, Envestra Limited's managing director, said.
However, he did not provide an exact timeline as to when the natural gas pipeline would be totally repaired, noting the company has to wait until the floodwaters recede.
Meanwhile, Andrew Cripps, Natural Resources Minister, said Queensland government inspectors will help locals make safe reconnections once the natural gas pipeline is operable and up and running.
"In cases where homes or other buildings have been flooded and gas appliances, meters or regulators have been covered by water ... the premises must be inspected and a compliance certificate issued by a licensed gas fitter," he said.