After a fierce storm, Captain Nathaniel Hawk arrives on the island of Oxbay. His first mate Malcolm Hatcher is retiring, and so Hawk must hire a new first mate and crew. As he leaves Oxbay, a French armada attacks the colony and captures it. Hawk manages to slip away and warn the English governor on Redmond Island, Robert Christopher Silehard, that Oxbay was attacked.

The governor sends Hawk on a series of quests to aid him in the war against France: Nathaniel is sent to investigate the condition in Oxbay; prevent a supply ship from reaching Oxbay; unload English troops in the jungles of Oxbay and rescue the English spy from the clutches of the French.

While preparing for his next quest - annexing Oxbay, Nathaniel meets his old friends: Danielle Greene and Ralph Fawn. However, Ralph is killed when the soldiers arrive to arrest Danielle and Nathaniel himself is captured and imprisoned. While in prison he gets to know an old ex-cannoneer Edgar Attwood who was fired for drinking too much rum. He can be later hired by the player into his crew.

Some time later governor Silehard arrives and tells Nathaniel that a big mistake has occurred. He sends Nathaniel Hawk on another series of quests until Nathaniel meets an old inventor who aids him in finding a treasure that could defeat the ghost ship called the Black Pearl.

There is also a large number of side quests. For instance, in one such side mission Hawk is enlisted to help a Dutch colonist find several kidnapped children.