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Did Klondike Ship Go Down With Half Ton of Gold?

Iceberg claimed SS Islander in 1901


October 05, 2019
Saturday PM

(SitNews) Ketchikan, Alaska - Just about everyone knows the story of the Titanic, the luxury liner that struck an iceberg and sank, taking 1,500 passengers to the bottom of the North Atlantic in 1912.

But far fewer know that a decade before, a smaller steam ship suffered a similar fate off Douglas Island near Juneau. When the SS Islander hit an iceberg and sank in 1901, more than a quarter of the passengers and crew - at least 40 people - died.

The SS Islander was built in Glasgow, Scotland in 1888 for the Canadian Pacific Navigation Company, specifically as a long-distance, well-appointed liner for the Vancouver to Juneau run. The discovery of gold in the Klondike meant the ship would be an active vessel on the British Columbia to Skagway run.

jpg Did Klondike Ship Go Down With Half Ton of Gold?

Steamship Islander of the Canadian Pacific Navigation Co. leaving Vancouver, BC for Skagway Bay in 1897.
Creative Commons

The 240-foot ship could carry up to 250 passengers and crew in what was considered near "luxury" accommodations, according to contemporary newspaper accounts.

"The ship was one of the most luxurious in the fleet and was a favorite of the gold mine investors, bankers and other wealthy individuals  involved in gold mining," The Times of London reported on August 20, 1901, the week after the sinking.

The Canadian Pacific Navigation Company had been founded in 1883 to provide service up the Inside Passage, but the loss of the SS Islander was the last straw for the company and it was purchased afterward by the Canadian Pacific Railway and the company's other ships, including the Princess Louise, became the CP's steamship division.

The SS Islander reportedly had 104 passengers and 61 crew members on board when it left Skagway on the evening of August 14. The ship was to go directly to Victoria, B.C.  Accounts differ, but it was estimated that ship was carrying anywhere from $500,000 to $2 million in gold, which would inspire decades of efforts to recover the cargo.

Shortly after 2 am, the ship slammed into a mostly submerged iceberg on the Stephens Passage side of Douglas Island, not far from Juneau. Initially the crew hoped to beach the ship on Douglas Island, but the damage to the port bow of the ship was so significant that within 5 minutes the bow was going down and the stern and the propellers were out of the water. The ship sank within 20 minutes. Captain H.R. Foote - who went down with the ship - reportedly said "tell them I tried to beach her."

More than 40 people drowned. Some accounts say 40, most say 45, at least one lists 72. But - as was the case with most shipwrecks of the time - the accurate passenger log went down with the ship. In 2013, the book "Sunken Klondike Treasure" was published, recounting a 1929 recovery effort by diver Leonard Delano, estimated that 65 passengers died. Fortunately, the proximity to Juneau meant there was a quick response and more than 100 people were saved.

Almost immediately after the sinking the amount of gold reportedly on board led to efforts to recover it.

Within a few weeks of the sinking, the CPNC sent the SS Haling to try and locate the wreck of the ship. The Haling searched for several days without success.

In 1902, the company sent an experienced diver Henry Finch to the find the wreck. He did, but determined it was too deep - approximately 350 feet - to dive on given the equipment he had.

Finch came back in 1904 with a diving bell and a custom made barge. He dove on the wreck and noted a "large gaping hole" in the bow of the ship. He attempted, unsuccessfully, to get into the purser's cabin, where a large amount of gold was believed to be. There was also an area near the bow that was believed to have a large amount of gold stored stored in lockers, but it was on the side of the ship that was buried in the muck.

Over the next quarter century several more attempts were made to salvage the ship, but weather, the strong current, cold water and the depth involved foiled all the attempts.

In 1929, an attempt was made to move the remains of the ship to Admiralty Island where it could be beached. Using steel cables, part of the hull was moved ashore, but the gaping hole - now determined to be more than 60 feet long - prevented most of the ship from being moved.

More importantly, the section of the hull where the gold storage lockers were wasn't with the main hull. This particular effort did recover some $75,000 worth of gold from other parts of the ship.

Once again, several attempts were made to find the rest of the gold over the next six decades. In 1996, Ocean Mar Inc. announced another effort and was immediately sued by Yukon Recovery to determine who had the right to any found gold. While the lawsuit was going on, Ocean Mar found another bow section of the Islander. The legal tussle was resolved in Ocean Mar's favor in 2000.

Unfortunately, by then, Ocean Mar had burned through the money it had planned to use to finance recovery operations. It would be another decade before it could proceed, after teaming up with MK Salvage. In 2012, an additional 1,200 ounces of gold - valued at nearly $2 million - was recovered. In 2016, that recovered gold was auctioned off for approximately $4 million, according to a 2016 story in the Anchorage Daily News.

But even with that recovery, of some 75 pounds of gold, there remains interest in the wreck of the Islander. Some contemporary estimates placed the amount of gold on the ship when it sank as approximately 1,110 pounds.

Less than 10 percent of that has been recovered to date.

It is possible, is there still $20 million of gold sitting at the bottom of Stephens Passage?



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Dave Kiffer is a freelance writer living in Ketchikan, Alaska.
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