(FORTUNE Magazine) - That eerie yellow and green glow emanating from the ice sculptures in Harbin this winter isn't the result of toxic chemicals in the city's water. But in November, six weeks before this industrial city in northeastern China opened its 22nd annual Ice and Snow Sculpture Festival, featuring a replica of Beijing's Summer Palace, a chemical spill a few hundred miles upriver threatened to cast a noxious pall over the festivities. An explosion at a state-run chemical plant released 100 tons of benzene into the Songhua River, which supplies Harbin's drinking water--and the blocks of ice with which its sculptures are made. The city's water supply was shut off for several days as the toxic spill floated downstream. Local officials were at first silent about the cause of the shut-down, but accounts of the spill posted on the Internet forced them to come clean. By then the river was no longer contaminated, and the city's supply of water was restored. Neither the benzene spill nor subzero temperatures seem to have affected the flow of tourists into Harbin. Visitors say the festival is as crowded as ever.