Photo: CTV News

Heavy smoke could be seen on a ship in the waters south of Victoria on Saturday afternoon, after the damaged containers caught fire.

The Zim Kingston was seen with plumes of smoke just hours after the vessel dropped 40 shipping containers into the ocean west of Vancouver Island.

CTV News Vancouver reported that the coast guard was notified of the fire aboard the Zim Kingston around 11 a.m.

A notice on the Coast Guard's Navigational Warnings website states that the ship is on fire and expelling toxic gas. An emergency zone has been established at Constance Bank within one mile of the anchored container ship Zim Kingston in the vicinity.

Two fallen containers are floating in the vicinity of the vessel.

A spokesperson for the Joint Rescue Co-ordination Centre in Victoria told CTV News Vancouver that ten crew members were rescued from the vessel before 6 p.m. while 11 others remained on board.

"The crew is mustered near their own lifeboats but the master hasn't made the call yet to abandon ship," said JRCC spokesperson Lt. Pamela Hogan.

The ship lost 40 shipping containers on Friday, including containers that can spontaneously combust. The fire was sparked inside two containers that were damaged when the ship was tossed by the stormy seas.

Hogan explained that while the Crew tried to put it out earlier on Saturday, they couldn’t do it themselves.

The ship was inbound for Vancouver when it listed to one side, dropping the containers into the ocean near the mouth of the Strait of Juan de Fuca.

"The situation is evolving," coast guard spokesperson Michelle Imbeau said Saturday evening. "Coast guard has been standing by making sure life and limb are OK."

The ship is being monitored by two coast guard vessels and an auxiliary firefighting vessel.

"When the crew has evacuated, when there are no people left on the vessel, then they'll do some oceanside firefighting," Hogan said.

Canada and the United States Coast guard officials have issued warnings to mariners to keep clear of the Zim Kingston due to the danger of smoke and falling cargo. A broadcast was also issued by the U.S. Coast Guard Navigation Center that the containers may be be partially submerged and not easily visible from the ocean's surface.

"Mariners should exercise extreme caution" when transiting the region, the centre warned.

So far, just eight of the lost containers had been located as of 4 p.m. on Friday, according to a spokesperson for the U.S. Coast Guard's 13th District in Seattle, Wash.

- With files from CTV News Vancouver