When using acoustic methods for pipeline leak locating, a problem that arises in practice, especially for small distances, is the correlated background noise due to the main stream. This noise overlaps with the primary source signal generated by the leak, causing errors in the estimation process. This paper proposes an algorithm based on using the phase data information, working directly with the wrapped phase sequence. Simulation results show that for a small signal-to-noise ratio, this method can lead to improved estimates. Experimental results performed on a small scale pipeline system indicate also a good performance of the proposed algorithm.