For the first time in more than 20 years, salvors have been approved to return to the SS Central America shipwreck to recover the remaining gold cargo.
The ship sank in 1857 with one of the largest documented cargoes of gold ever lost at sea and now lies at a depth of approximately 2,200 meters (7,200 feet) approximately 160 miles off the coast of South Carolina.
In a statement Thursday, Tampa-based Odyssey Marine Exploration, Inc. (Nasdaq:OMEX) said it has been awarded the exclusive contract to conduct an archaeological excavation and recover the remaining valuable cargo from the shipwreck.
Odyssey was selected for the project by Ira Owen Kane, the court-appointed receiver who represents Recovery Limited Partnership (RLP) and Columbus Exploration LLC (CE), which has a permanent injunction and exclusive salvage rights granted by the U.S. District Court for the Eastern Division of Virginia. The contract has been approved by the Common Pleas Court of Franklin County, Ohio, which has jurisdiction over Recovery Limited Partnership and Columbus Exploration, LLC.
So just how much gold is there?
“After conducting an exhaustive review of the extensive amount of historical research available on the shipwreck, our experts estimate the shipwreck still holds a commercial shipment of gold that was valued at approximately $93,000 in 1857, as well as a substantial amount of passenger gold valued in 1857 between $250,000 and $1,280,000,” said Kane. “The expert we retained to analyze the extensive collection of records and contemporary accounts of the shipwreck places the most likely 1857 face value of the total remaining passenger and commercial gold at $760,000. The ultimate value of the recovery can only be determined once the total quantity, quality and form of the recovered gold is known.”
The SS Central America shipwreck site was discovered in 1987 and less than 5% of the site was investigated at that time, with an extensive collection of gold coins, bullion and raw gold recovered in the following years.
Salvors, however, have not returned to the site for more than two decades as lengthy legal battles played out.
In May 2013, the court appointed Kane as receiver to supervise the resumption of recovery operations.
The SS Central America was a wooden-hulled, copper-sheathed, three-masted sidewheel steamship launched in 1852 as the SS George Law and sank five years later during a hurricane on September 12, 1857.
When it was lost, the SS Central America was carrying a large consignment of gold for commercial parties, mainly in the form of ingots and freshly minted U.S. $20 Double Eagle coins. Not only that, but the ship was also carrying more than 477 passengers, mostly wealthy miners and businessmen returning east from California with their personal possessions and fortunes amassed from years of prospecting during the Gold Rush. The financial loss was so great that the sinking actually contributed to the Panic of 1857.
In return for their salvage efforts, Odyssey Marine will receive 80% of recovery proceeds until a fixed mobilization fee and a negotiated day rate are paid, then 45% of the recovery proceeds thereafter.
Odyssey is presently preparing its recovery vessel, the Odyssey Explorer, to begin work on the site in April utilizing the company’s equipment and personnel.
“We’re very familiar with mid-19th century paddlewheel shipwrecks, as well as the range of artifacts that are likely to be on the site,” said Greg Stemm, Odyssey’s CEO. “We have extensive experience with the tools and techniques required for this archaeological excavation, which will be very similar to the successful recovery of more than 51,000 coins and 14,000 artifacts from the SS Republic completed by Odyssey 10 years ago. We’re also experienced in working at extreme depths. The SS Central America is less than half the 4,700 meter (15,000 feet) depth of the SS Gairsoppa, from which we successfully recovered nearly $80 million in silver over the past two years.”