The New York Times (New York, N.Y.; Nov 16, 1880; pg. 1) reported that, on the 10th of October, 1880, the Peruvians placed a large torpedo holding three tons of powder in the harbor at Callao. Clockwork controlled the firing mechanism. At 9 o'clock in the morning, observers on the coast saw an immense volume of water shoot into the air. The ground shook. In Chorrillos, a house collapsed.
However, the target of the attack, the Chilean fleet, remained out of danger. In Iquique, where a portion of the fleet had returned, they heard that the Almirante Cochrane was sunk, but this was merely a rumor.
Large Torpedo Explodes at Callao
The Covadonga is Sunk
In early September, the Chileans again bombarded Callao. On September 13th, 1880, while the Covadonga blockaded the small port of Chancay north of Callao, firing at the town with artillery, the Chileans saw an empty gig adrift. The crew of the Covadonga sent a boat to examine her. Having checked her thoroughly, they brought the gig alongside the Covadonga, and hooked her with tackles to hoist her in. As soon as a strain was brought on the after-tackle, the gig exploded. The blast blew in the side of the Covadonga.
The Covadonga sunk almost immediately. Apparently, the gig had been fitted with a false keel, packed with dynamite, and connected to an igniter, so that no explosion could take place unless an effort was made to hoist the boat. Twenty men, among them the Commandant, drowned or died as a result of the explosion; the rest reached land and were made prisoners. In retribution, the Chileans bombed the bays and neighboring ports of Callao, including Chorrillos, Chancay and Ancon. (Mason, 1885)
Resources:
Mason, Theodorus B. M. 1885. The War of the Pacific Coast of South America Between Chile and the Allied Republics of Peru and Bolivia. 1879-'81. Washington, D.C.: Government Printing Office.