When Morgan returned to Jamaica, he learned that the Jamaican Governor, Thomas Modyford, had just received word from England telling him that all hostilities against the Spanish must stop. As a result, Morgan used part of his booty to purchase over 800 acres of plantation land in Jamaica, and for a short time he retired from buccaneering. However, Spain was still authorizing raids against the English, and a few smaller settlements on Jamaica were attacked by the Spanish. With no time to contact England for instructions, Modyford gave Morgan a commission to “attack, seize and destroy all the enemy's vessels that come within his reach,” as well as to take and destroy anything that would “tend to the preservation and quiet of this island.”

Back in Business

With the receipt of this new commission, the buccaneers were back in business, and by the time Morgan sailed for his next conquest in December of 1670, he had thirty-eight ships and about 2,000 men with him. They had voted to head for Panama, the principal treasure port on the Pacific coast of Central America. Morgan first took the island of St. Catherine near Costa Rica to use as a base of operations. Next his men fought a battle against the Castle Chagres, which was at the mouth of the Chagres River in Panama. Morgan would need to control the river so that he could use it to transport troops and plunder in and out of Panama.

Morgan and 1,200 men took canoes up the Chagres River as far as they could, then they began to walk. But it was a terrible march. The Spaniards knew they were coming, and while they didn't dare fight the buccaneers, they did move ahead of them, killing all the animals, destroying all edible plants, and removing all food from the packs of fallen soldiers. Morgan and his men were quite literally starving. The overwhelming hunger was so bad, in fact, that many of the pirates took to eating their leather bags and leather shoes, hoping that the leather would ferment in their stomachs and give them some sustenance.

Last Stand

After about ten days of marching, Morgan and his men finally caught sight of the city of Panama, but the Spanish general, knowing they were coming, had stationed troops all across the road leading to the city. There were many more Spaniards than buccaneers, but the Spaniards were mostly new recruits, and they were no match for Morgan and his rovers. The pirates stood their ground and fired with deadly accuracy, and in no time more than 100 Spaniards were dead, and the rest were fleeing. Two herds of oxen were stampeded toward the buccaneers, but they simply shooed them back to the city, where they happily killed and ate them to help assuage their hunger.

The battle won, Morgan and his men took the city, only to find that much of its treasure had been moved out, and that gunpowder had been placed to blow up many buildings. The buccaneers raced through the city ahead of the burning buildings, searching desperately for gold and other valuables. Morgan's men searched the surrounding countryside, taking prisoners and torturing them to find out where the treasure was hidden. They succeeded in gathering a large plunder, but when they returned to St. Catherine's and divvied it up among everyone, it amounted to only about £15 apiece. Morgan insisted that he made a fair sharing of the plunder, that there wasn't that much taken, and that it was a smaller amount because it had to be shared among so many men. Many of the buccaneers were skeptical and felt that Morgan had cheated them by keeping the lion's share of the booty for himself. The truth of the matter is unknown, but Morgan felt it safest to let the buccaneers disperse, so he sailed back to Jamaica with just a few trusted friends.