A South Korean navy ship with 104 people on board sank near the North Korean border yesterday after an unexplained explosion, military officials said, and a news report said around 40 sailors were missing.

South Korea's government called an emergency security meeting but a presidential spokeswoman said it was still unclear whether the sinking resulted from a clash with North Korea.

Another South Korean naval vessel had opened fire on an unidentified object but it was later found to be a flock of birds, the Joint Chiefs of Staff (JCS) said.

The Cheonan, a 1,200-tonne corvette, sank late in the evening near Baengnyeong island in the Yellow Sea, which lies between the Korean peninsula and China.

Media reports said six naval ships, two coastguard vessels and four other craft were involved in a rescue operation.

A JCS spokesman said 58 crew members had so far been rescued but had no details on any fatalities.

Yonhap news agency quoted naval officials as saying several bodies were retrieved but gave no exact figure. Seven crewmen were airlifted to hospital.

"For now, it is not certain whether North Korea is related" to the incident, presidential spokeswoman Kim Eun-Hye said, adding President Lee Myung-Bak had ordered maximum efforts to rescue the crewmen.

"Finding the truth (behind the incident) is important, but saving our sailors is more important," the President was quoted as saying.

Another emergency meeting us due to be held this morning.