Oslo - A World War II wreck of a German submarine that sank off Norway loaded with 65 tons of mercury should be encased and not raised, the Norwegian Coastal Administration said Monday.

The wreck of U-864 was found in 2003. Since the discovery Norwegian authorities have investigated various options of raising or encasing the wreck since the cargo posed a potential threat to the marine environment.

In addition some 30,000 square metres of sea bottom around the wreck are regarded as polluted to a varying degree.

All 73 onboard died when a British submarine torpedoed U-864 in February 1945 as it was heading from Germany to Japan via Norway with war material including 65 tons of liquid mercury in steel containers.

The 87-metre-long submarine split into two large sections, but over 100 wreckage pieces have been found. The wreck rests 150 metres below the sea surface near the island Fedje, just north of the coastal city of Bergen. The wreck is also regarded as a war grave.

A previous report also recommended covering the wreck, but after protests parliament decided in 2007 to review the options again, and commissioned the Coastal Administration to look into the matter.

Coastal Administration Director General Kirsti Slotsvik told reporters the estimated cost of raising the wreck was 1 billion kroner (144 million dollars) while encasing it was
250 million kroner (36 million dollars).

"The price was not a factor," Slotsvik said, adding that the overall consideration was the environmental risk.

On accepting the final report, Fisheries and Coastal Affairs Minister Helga Pedersen said she hoped the government would be able to announce a "decision as soon as possible."

Norwegian consultancy firm Det Norske Veritas (DNV) was commissioned to investigate the consequences of raising the wreck.

DNV project leader Carl Erik Hoy-Petersen told reporters that the encasement of the wreck and sea bottom was deemed to pose the least risk to personnel and also had the least short- and long-term environmental impact.

A main concern with raising the wreck was the "spread of mercury" when sediment around the wreck is disturbed, Hoy-Petersen said.

Even if the wreck was raised, the sediment has to be capped, he added.

Although the submarine had 27 torpedoes and grenades onboard, the assessment suggested that there was just a "theoretical risk" they would explode under the encasement, he said.

Nearby contaminated sediments were also to be capped. According to the Coastal Administration the mercury would be safe for 3,400 years before seeping through the
1-metre thick cap of sand and rocks.

Local politicians in the communities near the wreck expressed disappointment over the decision not to raise the wreck. (dpa)