Silver bullion from sunken WWII ship makes it to the Mint at last

September 30, 2013

MONTREAL-CANADA  (Sept 30)  Commemorative silver coins are being struck from shipwrecked bullion that arrived at the Royal Mint more than 70 years late, after a German torpedo sent the ship carrying it to the bottom of the North Atlantic during the second world war.

The coins, intended for collectors, are made from part of a haul of almost 100 tonnes of silver recovered from a wreck lying three miles down, deeper than the Titanic. The silver is valued at up to £150m, the largest quantity of precious metal ever recovered from such a depth.

The coins show the doomed ship SS Gairsoppa, which sank on 17 February 1941 off the Irish coast after it was hit by a single German torpedo fired by U-boat U-101 weighed down by 7,000 tonnes of cargo including thousands of tons of pig iron.

Most of the 83 crew members and two gunners died immediately. The impact of the torpedo brought down the foremast, instantly destroying the wireless antennae, so the crew could not even send a distress call. Two of the ship's lifeboats were swamped in the stormy waves, and though the third made it to Cornwall 13 days later, only second officer Richard Ayres survived – the last of his comrades drowned when the boat capsized within sight of the shore.

The wreck is still sitting upright and remarkably well-preserved on the seabed 300 miles off the west coast of Ireland, its cargo hatches open and the gaping hole left by the torpedo clearly visible in its side.

The US salvage firm Odyssey, working under contract to the UK government, recovered the record amounts of silver over the past two summers using remotecontrolled vessels. In 2012, 1,218 ingots weighing 1.4m troy ounces were brought to the surface, and last July a further 1,574 ingots, adding up to 1.8m troy ounces, were recovered.

Under the terms of the contract, Odyssey keeps 80% of the silver, the rest goes to the Treasury, and a small amount is being returned to the Royal Mint for which it was originally intended.

In 1940, the decision was taken to import silver from India when the Mint's supplies were running low during the war. The ingots from Bombay were loaded onto the SS Gairsoppa, a British steam merchant ship, built on Tyeside in 1919. The convoy hit stormy weather. Heavy laden and running short of coal, unable to keep up with the other vessels the Gairsoppa decided to leave the protection of the convoy and head for Galway harbour. A few days later, still hundreds of miles from safety, the ship was spotted by a German aircraft, torpedoed just after midnight and sank within 20 minutes.

Correspondence between the Royal Mint and the Bank of England reveals that there was such concern over the loss of the bullion, valued in 1940 at £600,000, that it was feared the Mint might run out of silver completely and be forced to suspend production of coinage. The price of the new coins has not been disclosed, but coin collectors' websites suggest they are being marketed in boxes of 300 coins for $5,000 (£2,885)).

Some records suggest that more silver may still remain in the ship's hold, but Odyssey has found no trace of it, nor of human remains.

Odyssey was involved in an international legal wrangle last year, when US courts ordered it to return to Spain a spectacular hoard of almost 600,000 gold and silver coins, estimated at up to £308m. The treasure was initially landed at Gibraltar before being flown out to Florida. Odyssey said the coins came from a site codenamed Black Swan and were so scattered no wreck could be identified, but the Spanish insisted they were from a Spanish frigate, the Nuestra Senora de las Mercedes, sunk by a British squadron off Portugal in 1804.

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