Freezing passengers who huddled on the ship's top deck used their mobile phones to tell Greek television stations of their horror as high winds, rain and violent seas lashed the burning ferry on Sunday.

"We are on the top deck, we are soaked, we are cold and we are coughing from the smoke. There are women, children and old people," one of the passengers, Giorgos Styliaras told Mega TV.

Another passenger, Sofoklis Styliaras, told the station that passengers' shoes were starting to melt from the heat on the lower deck, where the lifeboats are.

"There's nowhere else for us to go. It's impossible to walk on the lower deck because of the heat."

A fire broke out in the lower deck garage of the Italian-flagged ANEK Lines ferry in the early hours of Sunday when it was about 44 nautical miles off the coast of Corfu, after leaving the Greek port of Patras en route to Ancona in Italy.

Rescue attempts difficult

Merchant ships in the vicinity of the Norman Atlantic gathered to form a ring surrounding the ferry in an attempt to buffer it from raging winds, reportedly gusting to up to 100 kilometers (60 miles) an hour.

Rescue vessels, firefighting vessels and helicopters from Greece and Italy were heading to the scene and the rescue operation is being coordinated by Italy.

Air crews have begun lifting passengers from the boat, with Greek authorities confirming 131 people were now out of danger according to Reuters.

Shipping Minister Miltiadis Varvitsiotis told reporters the coastguard, Italian authorities and Greek armed forces were in constant contact.

"We are doing everything we can to save those on board and no one, no one will be left helpless in this tough situation," he said, adding "It is one of the most complicated rescue operations that we have ever done."

In total there were 478 passengers and crew aboard the ship, a number revised slightly upwards from initial reports. Of those, about 268 were said to be Greek.

A life boat carrying 150 people had been lowered into the water but so far only about 42 of them had then be able to move to another nearby ship because rough seas made transfers difficult.

It remained unclear whether there had been any casualties or whether any of the passengers or crew had entered the water. If anyone were in the water, the cold winter temperatures would make survival difficult unless they were rescued quickly.

se/es (AP, AFP, Reuters)