* Firm behind red sludge spill resumes operation
* Some 380 residents return to village of Kolontar
* People should not move back due to health risks-Greenpeace
* Police questioned new suspect at firm MAL Zrt
(Adds MAL restarting, new suspect)
By Krisztina Than and Marton Dunai
BUDAPEST, Oct 15 (Reuters) - Hungary restarted a plant on Friday that fatally flooded villages with toxic red sludge and some residents evacuated last week returned to their homes despite warnings from environmentalists.
A spill of industrial waste last week at an alumina plant in western Hungary, owned by MAL Zrt, killed nine people, injured more than 120 and polluted a tributary of the Danube when the wall of a sludge reservoir failed.
The state commissioner who controls MAL&${esc.hash}39;s operations after the government took control of the firm earlier this week, said in a statement on Friday:
"It will take a maximum four days for the plant to go back to normal operation. Next Tuesday production will be up to full capacity."
Disaster crews said about 380 of the 800 people evacuated from the nearby village of Kolontar had moved back to their homes in the afternoon.
Meanwhile, police investigating the disaster have questioned a second suspect identified as Jozsef D., the technical director of MAL, but he had not been detained.
Police spokeswoman Monika Benyi told Reuters the man was suspected of causing danger to public safety and damage to the environment.
On Thursday a Hungarian court ruled that police should release from custody Zoltan Bakonyi, the head of the aluminium company MAL who was detained on suspicion of endangering public safety leading to multiple deaths and causing damage to the environment.
Hungarian police secured MAL&${esc.hash}39;s premises earlier this week and took over MAL&${esc.hash}39;s information systems after parliament rushed through emergency legislation allowing the centre-right government to take control of the company and its assets.
The exact cause of the disaster is still not known, but Prime Minister Viktor Orban has blamed "human negligence" for the spill, Hungary&${esc.hash}39;s worst ecological disaster.
SAFETY, HEALTH CONCERNS
Environmental group Greenpeace urged the government to keep the plant shut and said it was "entirely irresponsible" to let villagers return home because no data showed the area was safe.
"Greenpeace Hungary asks the government to suspend the plan to restart production at the plant until the causes of the disaster are clarified and environmental and health risks decrease significantly," the environmental group said.
Villagers were advised to wear a dust mask at all times, said a spokeswoman for disaster crews, Gyorgyi Tottos.
"It is mandatory to wear them, although there are no sanctions for not wearing a mask," she said. "Cleanup crews and heavy machinery are at work, which stirs up the dust even more," she told Reuters, adding it was up to every resident&${esc.hash}39;s individual judgement whether to return or not. She said earlier on Friday that the northern wall of the reservoir, which cracked on Saturday prompting the evacuation, had not shown further dislocation after the crack widened a few centimetres on Thursday.
Crews in Kolontar had built an emergency dam crossing the village to protect the area from a potential second sludge wave, in case of another reservoir wall failure. (Reporting by Krisztina Than and Marton Dunai; Editing by Matthew Jones)
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