The National reports that Goroka town manager Harold Abori said the landslide was in the Saiga jungle.
"It is hard for us (town authority) to do anything. It is the work of Mother Nature," he said.
"When rain comes, the mud will continue to move into the main river that feeds the town water supply system."
He said the town authority tried to use an excavator to divert the mud but to no avail.
Goroka Town Authority public relations officer Iyapo Meleke said tonnes of mud flowed down a hill which was very difficult to divert.
"There is a thick mud flow coming into the main river that feeds the town water supply. It is a very unfortunate situation.
"Town residents and business houses will continue to see brown water until the mudslide stops," Meleke said.
But Goroka water operations manager Jim Fanaso said the water coming into the town water pipes were treated and safe for use.
He said they cleaned up the treatment plant and the water coming through was carefully checked and treated.