Almost two years ago, a research submarine pinpointed the possible location of one of the most valuable wrecks in history, the sunken Spanish galleon San Jose, which went down 275 years ago off the coast of Colombia carrying gold and silver coins, ingots, plate, jewelry and religious articles now worth at least $1 billion.
Sea Search-Armada, a Chicago group that under an exclusive search contract has spent nearly $10 million looking for the San Jose, proposed to the Colombian government that it salvage the treasure and split the proceeds 50/50 with the government. Then, six months ago, according to Chicago venture capitalist Warren Stearns, head of Sea Search, talks with the government stalled inexplicably.
About then, Texas oilman John G. McMillian, the chief of Northwest Energy Co., a natural gas pipeline firm based in Salt Lake City, appeared on the scene to pursue "a longstanding interest."
Now, Stearns said, a Colombian navy officer has recommended that Stearns be awarded a 5 percent finder's fee and that McMillian get the contract to be the principal salvor.
Colombian President Belisario Betancur has appointed a special commission to advise him on the salvage contract. A decision on who gets the contract is expected soon.
McMillian said he hosted a dinner for numerous senior Colombian ministers in Bogota "in the past six or eight weeks" and visited them to discuss the proposal. "You call them up, tell them what you want to do and go see them," he said. At the beginning of the summer, he hired an archivist, Mendel Peterson, former director of underwater exploration projects for the Smithsonian Institution, to direct the effort to compute the location of the San Jose and the value of her cargo. Peterson said his work is not yet complete.
Stearns, who said he has visited Colombian officials in Bogota and the ambassador in Washington, calls McMillian "an opportunistic interloper with no background, no legal rights, making statements that he's a serious bidder. Colombian law and legal opinions give us exclusive rights to enter into a salvage contract with Colombia."
On Aug. 18, Stearns and several associates discussed their salvage problems with Senate Foreign Relations Chairman Charles H. Percy (R-Ill.) at the Chicago Club here.
Stearns said there is a "million-to-one chance" Sea Search has not found the ship. A Colombian refusal to grant salvage rights to the finders would be unprecedented, he said.
McMillian said his salvage effort could take up to 120 days of deep sea diving and cost Northwest Energy about $5 million if the hulk and its treasure are found.
"We have made a proposal to be the contractor for the Colombian government for the San Jose and other such wrecks as may be in Colombian waters," McMillian said. "The San Jose is there. I think it's been located; it hasn't really been verified. History says it's there, in 800 feet of water . . . . We have made a proposal. It hasn't been accepted . . . ."
He declined to divulge the terms of his proposal beyond saying, "We'd be looking at a continuing relationship with Colombia."
He said he believes there are "four or five" groups bidding for the right to salvage the San Jose.
The San Jose is now the rotted remains of a wooden vessel about 180 feet long that probably was launched almost 300 years ago in Spain. It was armed with bronze cannons, according to Sea Search's archivist, Dr. Eugene Lyon, who has spent years in the Archives of the Indies in Seville, Spain, researching galleons to learn about the Spanish presence in North America.
The bronze cannons, some weighing two tons, give the ship an unusual magnetic signature, which Stearns said he is certain that Sea Search's deep-diving submarine, Auguste Piccard, detected during several passes over a site where Lyons and two other experts calculated that the ship had come to rest under 800 feet of water. The San Jose was about 20 miles off Cartagena, New Grenada, as Colombia was called then, leading a treasure armada of 17 ships when she was attacked by a British squadron on June 8, 1708. The 64-gun Spanish ship was defeated. Just as the British flagship closed in to take her as a prize, she exploded and sank.
More than 600 Spanish sailors, officers, colonial gentry and servants drowned. They took with them all their savings, plus treasure headed for the coffers of King Philip V of Spain and the merchants who bankrolled much of Spain's New World enterprises.
Unlike most Spanish bullion ships lost in the Caribbean during the three centuries the Spanish plundered New World riches, not one royal escudo has ever been salvaged from the San Jose. At 800 feet, the Caribbean sea floor where it sank is far beyond the recovery capabilities of past years.
Armed with exotic gear perfected in this era of electronics, offshore oil drilling, deep-diving submarines and advanced knowledge of human chemistry, modern salvors now have the ability to locate and salvage deeply submerged wrecks covered with silt and coral. They use side-scan sonars, magnetometers, satellite navigation and undersea locator beacons.
The deepest, richest salvage to date occurred two years ago, when British divers working at 800 feet cut through the hull of British cruiser HMS Edinburgh and retrieved gold ingots worth $72 million. The ship went down after a German submarine torpedoed her in the frigid Barents Sea off the Soviet north coast in 1942 as she was carrying gold to the United States as a Lend Lease payment.
McMillian said he has retained the Scottish firm of divers who brought back the Edinburgh's gold to dive on the San Jose.
Assuming the galleon is found, whoever eventually gets the salvage contract will proceed in a similar way. A support ship will be positioned over the hulk and kept almost motionless.
Teams of divers will be put in pressure chambers and acclimated to depths of about 800 feet. They will breath mostly helium, mixed with a low percentage of oxygen to prevent nitrogen narcosis, the "rapture of the depths" that afflicts divers with normal oxygen in great depths.
Then, they will be lowered in a diving bell to the site and spend about four hours apiece in the frigid water, hosing silt off the wreck and searching for treasure. Warm water pumped from the support ship will be circulated through umbilical hoses through their soft rubber diving suits to keep them warm. At great depths and pressure, helium carries off bodily temperature at dangerously high rates.
When their shifts are over, the divers will be returned to the surface and spend their off-hours in pressurized chambers so that they can descend the next day without compression problems.