The Canadian submarine that was immobilised by fire in the Atlantic three days ago is being towed by tug to Faslane in Scotland.
Lieutenant Saunders, a combat systems engineer, died before he reached Sligo General Hospital by a Royal Navy Sea King helicopter on Wednesday night.
Rescue ships have struggled since Wednesday to attach a line to the second-hand non-nuclear submarine, HMCS Chicoutimi- which has been adrift in the Atlantic since the fire and get 54 crewmen to safety.
"Conditions are continuing to moderate but they have done the most difficult bit," an Irish navy spokesman said yesterday after the line was fixed to the submarine.
Nine crewmen were injured in the fire on Wednesday and three were airlifted to hospital in Ireland. One died, another was moved to intensive care yesterday, and the third was in stable condition.
Fire broke out on the HMCS Chicoutimion its voyage back to Canada from Scotland. It is one of four troubled submarines bought from Britain in 1998 - a purchase government opponents have long said was a waste of money.
An Irish vessel, four British ships and a US submarine support ship went to help the submarine, drifting 40 miles off the west coast.
Partial power was restored but not enough to restart the engines and poor weather made setting a tow-line difficult.
The Ottawa Citizennewspaper quoted defence documents as saying the Chicoutimi's hull was so badly affected by rust that the vessel could not dive to its usual operating depth.
Government officials have declined to say whether they will sue Britain over the submarines, which cost $750 million Canadian dollars.