Firm Sees Gold in Vehicles That Ride Beneath the Waves

Graham Hawkes finds it tough to fathom why we spend billions of dollars to explore far-away planets when another fascinating frontier exists right here on Earth, where gold and gems, unknown species and perhaps medical miracles wait to be discovered less than seven miles away.

“The ocean is 37,000 feet deep, but we’ve seen only to 150 feet,” says Hawkes, vice chairman of Deep Ocean Engineering, a San Leandro company that made the underwater camera system that last month discovered what appears to be the legendary “Lost Patrol” of the Bermuda Triangle.

Thousands more such treasures lurk in the depths, well below the murky places photographed by the likes of Jacques Cousteau and other celebrity explorers. Yet the dearth of sophisticated equipment to plumb the vast seas, Hawkes says, limits “access to two-thirds of this planet we call home.”

Deep Ocean thus hopes to be in the vanguard when the anticipated “gold rush” in underwater exploration materializes, propelled by publicity in recent years about the discoveries of the Titanic and treasure-laden shipwrecks.

From its modest 19-employee plant east across the bay from San Francisco, Deep Ocean has emerged as a leader in the small but growing field of supplying equipment to undersea explorers, researchers and salvors. Its largest rival--among about 20 companies worldwide--is Benthos in North Falmouth, Mass., which developed imaging systems that helped locate the Titanic and vehicles used in filming “The Abyss,” a futuristic underwater tale.

Founded in 1982, privately owned Deep Ocean has sold 205 small, metal-framed Phantom ROVs (remotely operated vehicles) to law and drug enforcement agencies, research centers, fisheries, military operations, nuclear plant operators and others. The devices can be fitted with robotic parts so they can make repairs or do welding.

In the Persian Gulf, Deep Ocean equipment is helping to detect and detonate mines. Occasionally, customers have found uses for the vehicles that the company never dreamed of, like the fisherman in Alaska who bought one to help him figure out where to put his crab pots.

Co-founder Hawkes, who grew up in London, had a “passion for aircraft” as a boy and dreamed of designing planes. As a young man, he worked on submarine projects for a large defense contractor.

At the time, the “commercial underwater industry was so backward it was a joke,” said Hawkes, 43. “It was a new industry in its infancy, so I hopped into it. I saw lots of opportunities to do neat stuff.”

With very little money, he and three colleagues, working out of a “derelict cottage” in England, built a Wasp, a revolutionary diving suit that looked as if it could have bubbled up from the pages of Jules Verne’s “20,000 Leagues Under the Sea.”

He moved to the Bay Area 11 years ago and, with famed oceanographer Sylvia Earle, started Deep Ocean to build large submersibles for offshore oil exploration and production.

When energy prices collapsed in the mid-1980s, the focus shifted to smaller, less costly vehicles that could aid a variety of users. Police departments use them to locate weapons and bodies. The Coast Guard scans ship hulls to look for drugs. Nuclear plant operators send them into water-filled reactors to look for lost objects and cracks.

Deep Ocean, which gets funding from a variety of investors, including Weeden & Co. in New York, also has developed the Deep Rover, a one-man submersible featured in National Geographic’s “Explorer” series.

And for the past two years, a team of volunteers has been scurrying to build what Hawkes calls the world’s first underwater aircraft. He designed the winged Deep Flight vehicle to propel a person through the water at 14 knots, up to 10 times faster than existing submersibles. National Geographic, TV New Zealand and IMAX films have provided grants.

The volunteers are making two such vehicles, one for Hawkes and one for Earle, a world-renowned diver who has logged more than 5,000 hours underwater and who last year was appointed chief scientist at the National Oceanic and Atmospheric Administration.

In 1989, Deep Ocean and some New York investors formed a joint venture, Scientific Search Project, to build and operate a towed sonar camera system to locate and salvage shipwrecks. Early last month, as the group’s high-tech salvage ship, Deep See, was searching for Spanish galleons 10 miles northeast of Ft. Lauderdale, Fla., in a corner of the mysterious Bermuda Triangle, the cameras picked out five eerie shapes at a depth of 600 feet.

The shapes turned out to be aircraft, all upright as if they had just come in for a landing. Deep See crew members were able to match some numbers with those of five Navy aircraft that vanished in late 1945 on a training flight.

A U.S. district judge granted Scientific Search Project temporary possession of the planes, but the company has since been negotiating with the Navy over the rights. A news conference, related to the negotiations, is scheduled Tuesday morning in Miami Beach.

In six months of searching, the Deep See treasure hunters found no gold but did locate the wrecks of 114 ships and planes. Their experience demonstrates the hit-or-miss quality of underwater exploration but also shows how much potential exists, Hawkes said.

“Just about everything lost in the ocean will be recovered in the next 15 years,” he added.

Hawkes and Phil Ballou, Deep Ocean’s president, bemoan the lack of financial support in the United States for companies developing deep-water exploration devices capable of going at a faster-than-snail’s pace.

The Japanese, for example, have developed submersibles that can go to 20,000 feet, but they are slow and ponderous. Deep Ocean’s goal is to build lightweight, agile machines that can zip through the water.

At $3 million and holding, Deep Ocean’s annual sales have been flat for the past few years, according to Ballou, who holds a Ph.D. in music composition from UC Berkeley and built music synthesizers before signing on with Deep Ocean. The profit margin on the ROVs, for which customers pay an average of $55,000, is about 40%, and the company is basically breaking even. (Benthos, with a much larger product line, has annual sales of $8 million to $10 million.) The bottom-line results don’t attract many investors, but Ballou and Hawkes hope that will change.

“In 10 years’ time, there will be a tremendous boom in the ocean,” Hawkes said. “People will wonder why we’re not there. The Lost Patrol is just a start.”