Following the capture of Tarakan Island on the East Coast of Borneo by Japanese Forces on January 12, 1942, the Central Invasion Force under Vice-Admiral Ibo Takahashi prepared to attack the port of Balikpapan. By January 17, 1942 the airfield on Tarakan Island had been repaired and the Imperial Japanese Navy's (IJN) 23rd Air Flotilla was using it as its new headquarters. This airfield would be used to provide air support to Japanese Naval Forces moving south to conquer the rest of Borneo.

The taking of Balikpapan was very important to the Japanese due to its oil fields and airfield. Also it would serve as staging area from which to attack Bandjarmasin, further to the south on the island of Borneo, which also had oil fields the Japanese wanted.

The Japanese quickly began gathering the Balikpapan Invasion Force at Tarakan Island. In an attempt to capture Balikpapan's oil fields intact, the Japanese sent orders to the Dutch authorities not to sabotage the fields or their installations. On January 21, the Balikpapan Invasion Force, consisting of the Sakaguchi Brigade (56th Regimental Group) and the Kure 2nd Naval Landing Force, set out from Tarakan Island. The forces for this invasion were carried in 15 transports which has a close escort of three old ex-Momi class destroyers now known as patrol boats P36 (ex-Fuji), P37 (ex-Hishi) and P38 (ex-Yomogi). In 1939 these old destroyers had their armament reduced to 2 x 4.7", 6 x 25mm, and 60 DC's. Engine power had been reduced to 12,000 shp, giving a speed of 18 knots. Further modifications in 1941 to the stern allowed for the launching of a Daihatsu landing craft.

Also providing close cover were the minesweepers W 16, W 17, and W 18, along with the sub-chasers Ch 10, Ch 11, and Ch 12. Rear-Admiral Shoji Nishimura provided the covering force in the light cruiser Naka and the destroyers Yudachi, Samidare, Harusame, Murasame, Minegumo, Natsugumo, Yamakaze, Suzukaze, Kawakaze, and Umikaze. Poor weather hampered both the IJN air support from Tarakan Island and the air reconnaissance efforts of the ABDA forces. ABDA air reconnaissance finally located the force and the ABDA command deployed the USN submarines S-40, Pickerel, Porpoise, Saury, Spearfish, and Sturgeon along with the Dutch submarines K-XIV and K-XVIII to try and intercept the incoming invasion force. Also available to the ABDA command was the American naval force located at Timor in Koepang Bay. Known as TF.5, this force is commanded by USN Rear-Admiral William A. Glassford and consisted of the light cruisers Boise and Marblehead and the destroyers of Destroyer Division 59: Parrott, Pope, John D. Ford, and Paul Jones. This naval force was directed to stop the Japanese invasion force and destroy the transports before it reached Balikpapan. The USN naval force proceeded north to locate and attack the IJN invasion force but quickly lost its most powerful unit, the light cruiser Boise when she ran aground on an uncharted reef in the Sape Strait. The damage Boise suffered was serious enough to force her to retire for repairs to the United States via Colombo. Soon after this incident the other light cruiser, Marblehead, developed engine trouble which dropped her top speed to 15 knots. There was no choice but for the four USN destroyers to leave Marblehead behind and rendezvous with her after the convoy has been attacked. The four old destroyers increased speed to 27 knots, which would allow them to arrive at Balikpapan around midnight on January 23rd.

The storms helped protect the incoming IJN invasion force until it was almost to Balikpapan. On the evening of the 23rd at around 1525, nine Dutch Martin Model 166 (B-10) bombers attacked from Samarinda (note: one source reports this attack as being made by three U.S. B-17s from Surabaya). Two of the transports, Tatsugami Maru and Nana Maru, suffered damage and Nana Maru (6557 tons) has to be abandoned. Nana Maru eventually succumbed to her wounds and sank. The other damaged transport continued on to Balikpapan where it anchored along with the rest of the invasion force at 1945. The Japanese anchor their transports in two rows. One row of eight ships is near the shore and the second row of five transports is anchored to the seaward side. Here the Japanese find the Balikpapan oil fields on fire. The Dutch authorities had not followed the Japanese instructions to leave the fields intact. Soon after anchoring the Japanese began preparations for landing their troops. While this is going on the Dutch submarine K-XVIII, operating on the surface due to the stormy weather conditions slipped through Admiral Nishimura's screen. The Dutch submarine sighted Nishimura's flagship the light cruiser Naka and fired four bow torpedoes that missed. Undeterred, the Dutch submarine commander, Lt. Cdr. van Well Groneveld, attacked and sank the transport, Tsuruga Maru (6987 tons) and reportedly damaged the patrol boat P37 around midnight. Nishimura, already concerned about submarines and not expecting an attack by ABDA ships, diverted his covering force towards the east to carry out antisubmarine sweeps.

In the meantime, the four USN destroyers of Destroyer Division 59 under the command of Commander Paul H. Talbot arrive from the south. With Nishimura's forces diverted to the east searching for submarines, the four old four-stacker destroyers attacked the transports virtually unopposed. With the transports silhouetted against the burning oil fields the USN destroyers began their first attack around 0316, the morning of January 24th. Not knowing the location of Admiral Nishimura's Covering Force, the destroyers made their first attack at high speed, launching ten torpedoes and firing their 4" guns at the anchored transports. Eventhough, the attack was executed at close range; little was achieved in this first pass at the transports with all the torpedoes missing their targets. Cdr.Talbot now reversed course to the south and reduced speed to make a more deliberate attack. The USN destroyers attained their first success when torpedoes from the leading destroyer, Pope, struck and sank the Sumanoura Maru (3519 tons) around 330. The last two destroyers in line, Parrott and Paul Jones, attacked the already damaged transport Tatsugami Maru (7070 tons) with torpedoes and obtained hits which cause her to sink at 335. This was followed by the Ford's attack with her main armament and torpedoes on the Kuretake Maru (5175 tons), which is struck by at least one torpedo quickly sinking her at around 345. Another two transports suffer damage from gunfire and torpedoes but remain afloat. Also at around 345, patrol boat P37 takes torpedoes and gunfire from the Pope and Parrot and is sunk in shallow water.

Having expended their torpedoes the USN destroyers made their exit to the south at 350 and tangled with two of the IJN patrol boats. Now alerted to the presence of ABDA surface forces attacking the virtually defenseless transports, Nishimura abandoned the antisubmarine sweep and headed west at high speed to defend them. The light cruiser Naka, with the destroyers Minegumo and Natsugumo are the first to arrive, but cannot catch the USN destroyers as they increased speed to make their withdrawal to the south for a rendezvous with the light cruiser Marblehead. So ended the USN's first surface action since the Spanish-American War of 1898.

Although the USN destroyers and Dutch submarine had sunk four of the transports, the Japanese landed their troops from 300 to 630 on January 24th, causing the Dutch commander in Balikpapan to ask for and receive permission to withdraw his outnumbered forces after putting up some resistance. The next day the seaplane carriers, Sanuki Maru and Sanyo Maru, arrived with their aircraft. By January 28th, the Imperial Japanese Navy 23rd Air Flotilla is operating out of Balikpapan's repaired airfield.

In reviewing this naval action it is unfortunate that the USN light cruisers Boise and Marblehead were not able to take part. Their participation should have resulted in the loss of several more Japanese transports. The destruction of several more transports could have halted the Balikpapan invasion or at least allowed the Dutch defenders to defeat the reduced ground forces. The heavier 6" main armament of these cruisers would have been much more effective against the transports than the smaller 4" guns of the old USN four stacker destroyers. Once the destroyers had expended their torpedoes, it would have taken many 4" shells to sink a transport. One can argue that the destroyers should have sunk more transports with their torpedoes, but the USN was still woefully inadequate in their night fighting training at this stage of the war. Also I'm sure that Cdr.Talbot knew that IJN escort forces would be in the area and that with his torpedoes gone, the 4" main armament of his old destroyers was no match for the 5.5" and 5" guns of the more powerful IJN light cruisers and destroyers.

Rear-Admiral Nishimura of the IJN had acted correctly in reacting to the submarine menace. Unforturnately for him, the USN destroyers attacked while he was engaged in antisubmarine sweeps. He reacted quickly to the new threat and could have avenged the loss of three of his transports if the USN destroyers had decided to stick around. He not only outgunned the old USN destroyers, but he outnumbered them with newer, more heavily armed destroyers and his light cruiser. His crews were also well trained in night fighting tactics against USN crews with almost no night battle training.

So while the potential was there for an ABDA victory, the fortunes of war for the Allied forces at this stage of the war did not favor them. The loss of the USN light cruisers left the attack of the Japanese invasion forces up to four old USN destroyers. While they did achieve some sinkings of the transports, it was not enough to keep the Japanese from invading Balikpapan.