Three people were rescued from a life raft after fishing trawler sank at the entrance to Bluff Harbour as it returned from a fishing trip on Friday morning.
A Mayday message was sent from the Ayson, a 13.4m trawler, on the maritime radio channel at 3.30am on Friday saying the vessel had hit rocks near Sterling Point and was sinking.
Sergeant Ian Martin, of Invercargill, said those on board also set off a distress beacon and a Coastguard vessel was sent to them. The three men were not injured.
Southland Coastguard said it found the men waiting for them in a life raft 150m offshore.
NZAS Rescue skipper Bill Ryan told Morning Report the rescue went perfectly, made easier by its proximity to the wharf.
Skipper Dylan Fowler said the Ayson went down very fast and he was quite shaken by the experience.
Bluff Fishermen's Radio operator Meri Leask said it was a relief they were rescued safe and well.
"I spoke to the Ayson, I heard him on the radio and then when they were in the life raft he phoned me off his cellphone.
"I just kept them on the phone until we knew that they were safe," Ms Leask said.
Southland Regional Council said there appeared to be very little environmental damage.
Scene commander Dallas Bradley said the boat was carrying an estimated 3000-5000 litres of diesel when it sank.
He said the skipper of another boat had reported seeing just a thread of diesel on the surface.
Divers were due to go down later in the day to attempt to block the leak and he expected they would also assess how easy it would be to salvage the boat.
Maritime New Zealand was to investigate the incident as the Ayson is a commercial vessel.
