Church Place, Church Walk and Wellington Street are closed, police have said, and sections of Market Street, William Street and North Street are also shut.
Motorists have been asked to avoid the area.
In a statement, Lockhart said: “This type of incident has no place in our society.
“I utterly and unequivocally condemn those responsible for this reckless and dangerous act, and would encourage anyone with information to bring it forward to the PSNI immediately.”
Lurgan Town Hall has been opened for residents who have been moved out of their homes, she said, and that it will “inevitably” cause major disruption in the area.
“My thoughts are with all those impacted, and I hope for a safe and swift resolution to this situation,” she added.
