Nov. 14 (Bloomberg) -- Captain Robert Mayne stands at the wheel as he guides the steel-hulled Aqua Quest from the docks in the Florida Keys, pointing the vessel toward what he’s been assured is a gold-laden shipwreck that may be worth tens of millions of dollars.
Mayne, 60, says experience has taught him such gold hunts can be perilous: inspiring obsession, sending treasure hunters on endless journeys and blinding them to reason.
“Gold makes people crazy,” says Mayne, who in his youth smuggled marijuana, and now has neatly combed, greying hair. “They become lost in their dream.”
Even he finds the pull irresistible. Investors who hold rights to the site southwest of Key West say it may be the resting place of a galleon sunk by a 1622 hurricane. Mayne has agreed to cover the cost of the excursion in exchange for half of any treasure.
Gold’s draw is a powerful one that drives both dreams and financial markets. It helped create a bubble in global gold prices, which gained more than sevenfold over a 12-year period. After peaking at $1,921.15 an ounce in September 2011, gold fell to as little as $1,180.50 in June. It closed at $1,281.83 on Nov. 13.
The drop is battering fortunes, from individuals who bought coins through TV offers to billionaires who bet wrong. The gold fund of John Paulson, the New York hedge fund manager, declined 62 percent this year through September.
Yet for treasure hunters, the recent drop hardly makes a dent in their ambitions. Gold prices are still higher than when they began their quests, years or decades ago.
The 65-foot Aqua Quest and its crew of salvage divers chug into open seas, the Gulf of Mexico to their right and the deep Gulf Stream far to their left. The water ahead is pale blue, like in Caribbean resort brochures.
The investor who struck the exploration deal with the firm Mayne founded, Aqua Quest International Inc., is Kenny Rose, a retired real estate agent and former bartender who has spent 33 years looking for the wreck.
He began his search after a chance meeting with a man on the Key West waterfront who had a treasure map. Rose and other investors have poured $1.23 million into the hunt over the decades, he says. They owe $320,000 in legal fees for securing rights to the site.
“I started when I was a young guy,” says Rose, 69. “You want to get famous. You want to do something with your life. Wine, women and song.”
Rose, who sports a mustache and a patch of hair beneath his lower lip, rattles off the specifications of what the divers should be prepared to find. “Twenty-three tons of silver, 22 bronze cannons,” he says. “Hundreds of pounds of gold.”
A sheaf of papers, he says, holds evidence he’s on the right track, including sonar scans that indicate the site, 50 feet down, is encased in the remains of wood worms.
“My theory is that’s crust from worms that ate the boat,” Rose says. The treasure should be under that layer of shell-like tunnels the creatures create as they consume wood.
Gold’s mystique lies in the unique values attributed to it for millennia: a store of economic value; portable wealth that transcends political change and war; a prestige item for display; the stuff from which idols are made.
The element also seduces. El Dorado, as the legend goes, lies deep in a jungle in the Americas, filled with gold. Almost as soon as Spanish explorers arrived, lives were lost chasing the mirage. The real treasure was in mines, whose metals got loaded onto ships. In 1622, a fleet setting out to Europe from Havana, 90 miles south of Key West, sank in a hurricane, leaving rich underwater remains.
Today the U.S. treasure hunting industry ranges from small operators like Rose to Key West’s Mel Fisher group, known for finding the 1622 Spanish Atocha wreck in 1985, to Tampa, Florida-based Odyssey Marine Exploration Inc., with a market value of about $180 million.
The gold is out there, found through a combination of archival research, high-tech tools, luck and obsessive persistence.
“At some point in life, everyone dreams about finding gold,” says Kim Fisher, chief executive officer of Mel Fisher’s Treasures LLC and a son of the late treasure hunter. “It’s gold fever.”
For Rose, now twice married and with an adult daughter, his search has become about “vindication,” he says, “that I didn’t waste my life chasing this treasure, that there actually is something there.”
On the expedition’s first day last July, it takes almost two hours to reach the site. Along the way, Mayne, who grew up on Cape Cod and is CEO of Tarpon Springs, Florida-based Aqua Quest International, says gold alone can’t pay the bills.
“Treasure hunting is a broken business model,” like playing the lottery, he says.
The reliable income is in less-shiny metals, such as the 10 tons of lead bars he pulled from a World War II-era shipwreck, or the copper ore he found in a ship’s open holds beneath the Atlantic, guarded only by sharks, he says.
To make his point, he tells the story of how he once spent two years helping investors seek Nazi gold off the coast of South America -- gold that, most likely, never existed.
Mayne says hunts like that happen all the time.
Slowing down, the Aqua Quest approaches the locus of Rose’s dream. Mayne uses a global positioning system to anchor above Rose’s wood worm crust. Then the mundane reality of treasure hunting starts.
Divers take shifts, beginning with Mayne. The ocean floor is a dead zone, with no sea grass. An occasional stingray glides by, barely visible against the sand.
The men excavate with a rigid vacuum tube, about 15 feet long and the width of a grapefruit. It works by forcing pressurized water down a fire hose and into the bottom of the tube. As water escapes up through the tube toward the surface, it creates suction.
After a few hours, the first mate, James Kelly “Boo Boo” Garrett, 52, comes up with encouraging evidence: a handful of chalky, corkscrew-shaped tubes. It’s the worm crust.
“That was wood down there at some time,” Mayne says.
Still, by sunset when he steers the Aqua Quest into the marina, Mayne says the day has gone slowly. The next morning he has a solution: a rented air compressor the size of a hot dog cart. Back on site the next day, the crew attaches it to a bigger tube, a 40-foot-long, white, plastic column as wide as a bowling ball.
They slide the tube into the water and Mayne dives down 47 feet. At the bottom, he pulls a handle to release the air. Silt and rubble shoot toward the surface. Underwater, it looks like a factory smokestack.
After 40 minutes, Mayne surfaces. “This is getting work done,” he says. “Like a hot knife through butter.”
He’s exposed a patch of crust about 5 feet across. After eating a sandwich for lunch, Mayne picks up a 5-foot, rusty crowbar with a pointed tip.
He’s going to start opening up the crust he says, smiling.
When he surfaces, it’s with bad news. The crust is at least a foot thick. The crowbar is useless.
Later, diver Kevin Kirk, 43, announces he’s gotten his hands underneath a hole in the crust.
“I could feel like edges of something, you know, almost like shale,” he tells Mayne.
“That could be ballast,” Mayne says, stones ships carry to improve stability. “Exciting.”
Mayne is smiling again.
“Tomorrow’s going to be a very interesting day,” he says.
Kenny Rose, the retired real estate agent behind Mayne’s expedition, first saw Sam Kirby in 1977. Kirby, who rarely cut his wild wisps of white hair, was standing on the deck of a partly sunken shrimp boat off Key West’s waterfront, wrestling a bronze propeller shaft out for salvage. Rose, 33 that year, was cruising by on his bike.
“I got off and helped lift,” Rose says. The men became friends.
After growing up in New York’s Long Island suburbs and graduating from Adelphi University there in 1968, Rose had followed his parents to Florida and migrated to Key West as a boat carpenter.
On a Sunday at the local flea market in 1980, he and Kirby sat on the back of Rose’s Toyota station wagon. Kirby, who was 62 that year and made his living sketching caricatures for tourists in bars, explained he’d found a wreck.
Rose said Kirby told him a priest did research for him in Jesuit archives. Based on those leads, Kirby, diving alone, had located the ship’s plate room, a section that held the most precious cargo -- gold and jewels -- accessed through the captain’s quarters.
Rose wanted in. He agreed to invest, and they began their search.
It got off to a slow start. For about three years, they tried and failed to assemble a salvage ship from rotting hulls.
They contracted with a salvage company in 1984 and got immediate results, finding a 2,300-pound anchor, Rose says. Over the next two years, they raised two crucial artifacts: a metal strap and a smaller anchor, about 8 feet long.
With those two pieces, in 1986, they laid claim in Miami federal court to the site’s “wrecked and unidentified sailing vessel.” The claim helped Rose bring in $40,000 in investments from family members and friends. They used the money to build a ship, La Grande Derriere, he says.
Work could be dangerous. In one incident, in November 1986, Kirby was anchored overnight at the site on La Grande Derriere when someone cut the lines, setting him adrift. The boat had no working engine.
The Coast Guard launched a search, using a Falcon jet, according to a United Press International report at the time. After four days, a cutter found Kirby halfway to Havana, according to Rose.
The breaks came slowly. In 1989, a company working with Kirby discovered a beam of wood embedded in the worm crust. It was carbon dated to 1588, plus or minus 50 years, Rose says.
Two years later, I met Kirby as a reporter at the Key West Citizen newspaper. He lived in a shack in a rooster-infested slum of Key West. Sores on his ears wept, un-bandaged, presumably damaged by years of exposure to the sun. His tales verged on the fantastic.
“At one time you could walk on the deck,” he said of his sunken ship. He described diving his site alone using an air tube connected to his 13-foot boat, and wearing overalls instead of a wetsuit.
He also claimed his ship was at least part of the Atocha -- the very same wreck treasure hunter Mel Fisher had already found in 1985.
Kirby made the claim even though markings on Fisher’s silver bars matched the Atocha’s manifest.
“He did claim a couple times that what we found wasn’t the Atocha,” says Kim Fisher, who doesn’t rule out that Kirby’s site might have a different 1622 wreck on it. “We just kind of ignored it because it was just so far out in left field.”
Rose believed Kirby about finding a wreck despite being unable to verify very much about the man.
Kirby told Rose he was born in Brooklyn, escaped from an orphanage when he thought he’d killed a man, worked making newsreels in the 1930s, captained an Australian combat ship in World War II and inspired a Joni Mitchell song, to name a few highlights.
“I know he made up stories and embellished,” Rose says. “He was a weaver of words.”
That is, for all these years, Rose has been following the dream of a fabulist.
When asked why he’d knowingly do this, Rose explains it’s the archaeology that drives him, not the man. “Occasionally I get a little drink of evidence, and it keeps me going,” he says.
Kirby died in 2001, Rose says.
Rose has continued the hunt, setting aside whether Kirby dreamed up any of it, and making fitful progress. In 2006, divers who punched a small hole in the worm crust came up with what Rose says is evidence of ship life: a nut, some coal and a square object he calls a rosary box.
For day three of the Aqua Quest expedition in July, the captain comes up with something to crack the crust: a rented jackhammer that works underwater. As the day goes by, the tool rattles divers’ bones and widens the hole, yet reveals no treasure or ballast.
On day four, at 4 p.m., Mayne surfaces from his last dive.
“There’s no sign of a shipwreck.”
He’s done, but he has one last idea. If the crust is a fossil shipwreck, there’d be nails in it.
The divers float jagged chunks of crust to the surface. On deck, they break them with the jackhammer and hold the pieces to a metal detector. Each piece passes without a beep.
One at a time, they toss the crust into the wake as the ship heads toward Key West.
The Aqua Quest’s expedition is over.
Rose keeps going.
“After 33 years, I’m not quitting,” he says.
A few weeks later, in August, he commissions a scan with a device called a Pulse 10, which when dragged along the sea bottom can use electric current to detect nonferrous metals -- gold and silver.
After surveying an area half the size of a football field, the Pulse 10 discovers only a modern, metal pipe.
Then, in September, Rose tries a different device, which uses radio waves. Just point it over the surface of the water. Rose says the equipment sensed possible gold and silver in the area.
“Things are flowing along as we ready our new workboat,” he said via e-mail. “The beat goes on.”
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