* EPA looking into possible contamination of water in Dimock * Some residents have long said fracking polluted the water * Findings could help sway EPA's outlook on fracking rules (Adds EPA comment, background) By Edward McAllister and Timothy Gardner NEW YORK/WASHINGTON, Jan 5 (Reuters) - Federal regulators are considering retesting water supplies at a small town in Pennsylvania that residents say have been contaminated by natural gas drilling. Just a month after declaring water in Dimock safe, officials from the Environmental Protection Agency are taking another look after new evidence provided by residents suggested that drinking water could be more polluted than originally thought. "We believe that additional information is needed to better understand the situation in Dimock and respond appropriately," an EPA spokeswoman told Reuters on Thursday, after receiving hundreds of pages of data from Dimock residents. "EPA is considering next steps including conducting some samples of well water in the area," the spokeswoman said. The tests may become pivotal in a national debate about the environmental impact of hydraulic fracturing, or fracking, the drilling technique that could unlock decades' worth of natural gas trapped in shale deposits, but which environmentalists say contaminates water supplies. Dimock, among the most heavily drilled areas in the Marcellus Shale, has become a flashpoint for the growing tension between energy companies and locals in shale regions. The EPA's promise to conduct more testing will be a victory for residents, who have complained that their concerns have been ignored. Federal officials told affected residents, some of whom have been without fresh drinking water since drilling began there three years ago, that they may begin testing their water within two weeks. "The EPA realise that they made a bad decision," said Dimock resident Julie Sautner, who was visited by the EPA on Wednesday. "They never came in and tested our water." Residents began complaining of cloudy, ill-smelling water in 2008 after Cabot Oil & Gas began fracking, a technique that involves injecting chemical-laced water and sand into wells to release gas in shale rock deep below the surface. Environmentalists say fracking pollutes fresh water as fluids seep from drilling wells into aquifers and other supply sources. A recent EPA study showed that harmful chemicals from fracking fluids were likely present in a Wyoming aquifer near the town of Pavillion. Cabot had trucked water to a dozen Dimock households for three years until November when state regulators said tap water standards were good enough for them to stop. It is not clear how the EPA made its original conclusion in November that the water was safe, having not done its own sampling before. But tests were carried out by the Pennsylvania Department of Environmental Protection in 2010 and Cabot in September 2011. Cabot was not immediately available for comment. Meanwhile, the dozen households in Dimock are now running out of water after Cabot halted supplies. Environmental group The Sierra Club has arranged for trucks to deliver water since December, but the last planned delivery arrived on Tuesday. Some are now using pond water for showering. The EPA is conducting a national study on the impacts of fracking which has led to an energy production boom in the United States. Industry denies that fracking, which is being done across the country, poses a threat to drinking water. (Reporting By Edward McAllister in New York and Timothy Gardner in Washington; Editing by Andrea Evans and Bob Burgdorfer)