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On 16 November 1904 a Norwegian, C. A. Larsen, with experience of whaling in Arctic waters, established the first whaling enterprise on South Georgia at Grytviken. Larsen's enterprise was commercially very successful. Oil and by-products from one whale could fetch £2,500. His company returned relatively high dividends in its early years of operation. Huge interest in obtaining whaling licences followed. The Government then imposed restrictions on their issue and conditions to ensure that the complete whale was to be processed rather than just the blubber, to try to sustain the industry.
Initially only blubber was taken and the carcass discarded, resulting in beaches strewn with bones along the coast line. By 1912, seven whaling stations had been established and South Georgia became known as the southern capital of whaling. Stations were built and operated as follows:
Pelagic whaling occurred from the late 1920s - the shore-based whaling industry on South Georgia declined due the scarcity of whales around the island. This was followed by a rapid expansion in whaling on the high seas of the Southern Oceans using factory ships (known as pelagic whaling). South Georgia was used for repair, maintenance and storage. Uncontrolled whaling on the high seas followed and led to significant reductions in populations of exploited whale species. Whale Catchers (holding up to 500 tones) could steam to whaling areas up to 300 kilometers away. Whales were harpooned with an explosive grenade, inflated with air and marked with a flag, radar reflectors, and latterly radios. A catcher would then tow them to a factory ship or shore station. The whale was hauled to the flensing plan. The blubber was removed and boiled under pressure to extract the oil. Meat and bone were separated and boiled. The results were dried and ground down for stock food and fertilizer. Baleen whale oil was the basis of edible, pharmaceutical, cosmetic and chemical products. It was also an important source of glycerol to manufacture explosives. Between 1904 and 1965 some 175,250 whales were processed at South Georgia shore stations. In the whole of the Antarctica region some 1,432,862 animals were taken between 1904 and 1978, when hunting of the larger species ceased. Probably the largest whale ever recorded was taken at South Georgia, it was a blue whale processed at Grytviken in about 1912, with a length of 33.58 meters. Another was processed in 1931 at Prince Olaf Harbour was 29.48m long and estimated to weigh 177 tonnes. Whale oil was a superior lubricant to mineral oil.
Today much evidence of the whaling industry remains on South Georgia, including the cemeteries where many whalers are buried. Grytviken Whaling station has been extensively cleaned to remove hazardous materials, such as asbestos, heavy oils and rotten building fabric.
Visitors can now walk over the site and view the exposed machinery. Access to the other large whaling stations at Husvik, Stromness, Leith and Prince Olaf Harbour is forbidden because of the high concentrations of hazardous materials that remain and the unsafe disintegrating building structures.
The Grytviken Church was built in Norway by Strommen Trevarefabrikk for C.A.Larsen with its two bells cast in Tonsberg. Larsen provided the church in order that the whalers might have a focus away from more "sinful" diversions. The whalers however, despite this well meant intervention, remained fairly secular!