Operations - Research

Proposed salvage activity is supported by extensive research in primary and original sources to obtain credible and testable information which is collated into the Database which has been built up over a period of over 20 years and which now contains details of over 12,000 wrecks.

There are no lists or books giving the names of all ships sunk and their cargoes therefore the Group has had to make a list, compiling over 20 years of work on different information sources into a single database.

Blanket research (involving a systematic study of insurance files, marine records, bank files and government archives) starts the research process and this has focussed on the UK government archives for both World Wars containing details of cargoes lost.

The data collected typically includes information relating to the nature and quantity of the cargo that has been lost, the circumstances and location of the sinking and ownership. Information has been gathered from the archives of a number of institutions in several countries and is conducted in government record centres, insurance company and business archives, maritime and military archives and other public and private libraries.

To date the research has concentrated mainly on UK sources, partly because London is a major centre of the marine insurance industry and partly because the UK government records relating to war losses are available. There are a large number of public information sources in London.

Some research has been carried out in other countries, including the USA, Germany and France.

Wreck data is subjected to management scrutiny and, once accepted, becomes a project and further research is authorised. Additional information is provided to the survey team focusing on weather information, sea bed data, additional ships drawings and photos and other wrecks that are known through the Database to be in the immediate area to allow for the planning of the survey cruise and the identification of the target wreck.

The Group's policy is to concentrate on wrecks where ownership is known and where a contract can be negotiated with either the Salvage Association, a government or other owners, before commencing the salvage. Such contracts typically provide that the salvor will receive between 85 per cent. and 95 per cent. of the sale proceeds of the recovered cargo. Although the contract route is the preferred method for the Group’s proposed operations, it is not essential to have a salvage contract in place.

The Law of Salvage is generally favourable to the salvor, who would normally receive approximately 90 per cent. of the cargo value in an arbitration proceeding should ownership be disputed.

Types of Wreck

Based on the information contained in the Database, the Group has identified 3 types of salvage Project:

• Commercial Class A Projects encompass wrecks of cargo ships which the Directors believe, based on thorough research, have a gross cargo value in excess of US$20 million each.
  The Commercial Class A Projects identified to date comprise some 22 wrecks with a combined total gross value of c.$1.0 billion (as at 30 April 2007).
• Commercial Class B Projects carried similar cargoes as Commercial Class A Projects differing only by the smaller quantities carried. The Directors believe, based on thorough research, that the these Projects have a gross cargo value greater than US$10 million each.
  These wrecks are of particular interest when in the vicinity of Commercial Class A Projects, where their exploitation requires little additional mobilisation costs and their reduced individual cargo volumes can be exploited economically ( i.e. lower volumes = quicker salvage).
  There are currently some 46 wrecks in this category with a combined total gross value of c.$0.7bn billion (as at 30 April 2007).
• Historical wrecks range in date mainly from the mid 17th century to the late 19th century.