At 04.14 hours on 23 Sep 1943, U-238 fired two T-3, two FAT and then another T-3 torpedo at convoy ON-202 south-southeast of Cape Farewell. Hepp reported four ships of 19.000 grt sunk and one damaged. However, only three ships, Oregon Express in station #103, Fort Jemseg in station #94 and Skjelbred in station #102 were hit and sunk.

The Skjelbred (Master Torjus Emil Johnsen) was hit on the port side aft by one torpedo and the flooding of #5 hold, the shaft tunnel and the engine room caused a list to starboard. The explosion disabled the steering gear and the ship made slow circles after about one hour in an attempt to steer with the engines. It was planned to rig up an emergency rudder, but HMS Northern Foam (4.76) (Lt H.G. Ross) arrived soon thereafter and ordered them to abandon ship. The master, 37 crew members and five gunners left the vessel, which was last seen in a sinking condition. The survivors were landed in St. Johns on 26 September.