* Radiation so high person could become sick in 10 hours
* Utility struggled to keep site under control since quake
* South Korea calls for more public information
By Yoko Kubota and Yuka Obayashi
TOKYO, Aug 20 Contaminated water with dangerously high levels of radiation is leaking from a storage tank at Japan's crippled Fukushima nuclear plant, the most serious setback to the clean up of the worst nuclear accident since Chernobyl.
The storage tank breach of about 300 tonnes of water is separate from contaminated water leaks reported in recent weeks, plant operator Tokyo Electric Power Co said on Tuesday.
The latest leak is so contaminated that a person standing half a metre (1 ft 8 inches) away would, within an hour, receive a radiation dose five times the average annual global limit for nuclear workers.
After 10 hours, a worker in that proximity to the leak would develop radiation sickness with symptoms including nausea and a drop in white blood cells.
"That is a huge amount of radiation. The situation is getting worse," said Michiaki Furukawa, who is professor emeritus at Nagoya University and a nuclear chemist.
The embattled utility Tokyo Electric has struggled to keep the Fukushima site under control since an earthquake and tsunami caused three reactor meltdowns in March 2011.
Japan's Nuclear Regulation Authority has classified the latest leak as a level 1 incident, the second lowest on an international scale for radiological releases, a spokesman told Reuters on Tuesday.
It is the first time Japan has issued a so-called INES rating for Fukushima since the meltdowns. Following the quake and tsunami, Fukushima was assigned the highest rating of 7, when it was hit by explosions after a loss of power and cooling.
A Tokyo Electric official said workers who were monitoring storage tanks appeared to have failed to detect the leak of water, which pooled up around the tank.
"We failed to discover the leak at an early stage and we need to review not only the tanks but also our monitoring system," he said.
Tokyo Electric, also known as Tepco, said it did not believe water from the latest leak had reached the Pacific Ocean, about 500 metres (550 yards) away. Nonetheless, continued leaks have alarmed Japan's neighbours South Korea and China.
Tepco has been criticised for its failure to prepare for the disaster and been accused of covering up the extent of the problems at the plant.
In recent months, the plant has been beset with power outages and other problems that have led outside experts to question whether Tepco is qualified to handle the clean up, which is unprecedented due to the amount of radioactive material on the site and its coastal location.
The government said this month it will step up its involvement in the cleanup, following Tepco's admission, after months of denial, that leaked contaminated water had previously reached the ocean.
Fukushima Governor Yuhei Sato told an emergency meeting of prefectural officials on Tuesday it was a "national emergency", and that the local government would monitor the situation more strictly and seek additional steps as needed.
Massive amounts of radioactive fluids are accumulating at the plant as Tepco floods reactor cores via an improvised system to keep melted uranium fuel rods cool and stable.
The water in the cooling system then flows into basements and trenches that have been leaking since the disaster.
Highly contaminated excess water is pumped out and stored in steel tanks on elevated ground away from the reactors. About 400 tonnes of radioactive water a day has been stored at Fukushima.
In order to keep up with the pace of the flow, Tepco has mostly relied on tanks bolted together with plastic sealing around the joints. Those tanks are less robust - but quicker to assemble - than the welded tanks it has started installing.
The latest leak came from the more fragile tank, which Tepco plans to carry on using, although it is looking at ways to improve their strength, said Tepco official Masayuki Ono.
A puddle that formed near the leaking tank is emitting a radiation dose of 100 millisieverts an hour about 50 cm above the water surface, Ono told reporters at a news briefing
Tepco has also struggled with worker safety. This month, 12 workers decommissioning the plant were found to have been contaminated by radiation. The utility has not yet identified what caused those incidents, which only came to its notice when alarms sounded as the workers prepared to leave the job site.
A South Korean Foreign Ministry spokesman said Seoul had asked Japanese officials to explain what they were doing to stop contaminated water reaching the ocean and fishing grounds.
"They also need to make the information available to the public, all over the world, given this is the first case in history where contaminated water from a nuclear plant is flowing into the ocean at this magnitude," he said.