Europe News

Shipwreck to Yield Biggest Silver Haul

By Mark Odell, Financial Times

The wreck of a British merchant vessel, sunk during the second world war, looks set to yield the largest haul of precious metal at sea, after a US exploration company said it had found the ship, which was carrying 7 million ounces of silver.

The hoard is worth £135 million ($210 million) at today’s prices, although its value has fallen 24 percent since last Wednesday, as the silver price suffered its largest decline in 30 years.
The SS Gairsoppa was torpedoed by a German submarine, U-101, in February 1941 as it neared the end of a voyage from Kolkata (then known as Calcutta) in India to London. The wreck was located 4,700 meters below the surface and about 480 kilometers off the coast of Ireland in international waters.

There was only one survivor among the 85 crew, despite 32 sailors taking to the lifeboats. Richard Ayres, the second officer, reached shore at the Lizard lighthouse in Cornwall, 13 days after the attack on 1 March 1941.

The Gairsoppa had started her final voyage from India in December 1940 with nearly 7,000 tonnes of cargo on board, including pig iron, tea and the silver.

The ship had sailed in convoy without a military escort for much of its voyage and was due to join up with an escorted convoy as it moved into the north Atlantic. But, weighed down by its heavy cargo, it was forced to reduce speed due to high winds and heavy seas and as it started to run low on fuel it was broke away from the convoy and headed towards Galway in Ireland.

On the night of February 16, the ship was hit behind the bridge by a torpedo from U-101. The commander of the U-boat broke off the attack because of the weather and left the freighter to sink in the heavy seas in just 20 minutes.

Odyssey Marine, a US-listed deep-ocean exploration company, was awarded the contract to salvage the vessel last year and said it was entitled to keep 80 percent of the net value of the cargo. The company’s shares, which are listed on Nasdaq in New York, jumped on the announcement and were up 7.5 percent at $2.86 at the close of trading on Monday.

The UK Department for Transport confirmed the government would receive a fifth of the value of the haul. It said it had awarded the contract under competitive tender and that Odyssey’s bid “offered the best rate of return” to the taxpayer.

Odyssey, which aims to start work on salvaging the silver early next year, was also responsible for the discovery of the wreck of HMS Victory, one of the most powerful warships built in the age of sail and the flagship of Admiral Sir John Balchin, which sank in the English Channel in 1744.