PRICELESS watercolours, drawings and letters by Charles Rennie Mackintosh kept in a vault in Glasgow School of Art miraculously escaped undamaged from the fire that ravaged the building.

The treasured items were among historic documents and important artefacts stored in a fireproof archive in a lower basement in the west wing, the part of the A-listed Mackintosh designed building worst hit by Friday's blaze.

But in a fortuitous turn of events, art insiders have revealed the works, including letters to and from Mackintosh about the building, were kept inside a concrete- encased, fireproof container that survived intact.

"One of the most important things in all of this is that Mackintosh works which were in the archive are safe," one source said.

"I've been told that among the things which are fine are Mackintosh papers, watercolours and drawings. This is obviously a terrific development."

A delicate salvage operation to remove millions of pounds worth of artefacts from the gutted remains began in earnest yesterday.

It emerged that the 19th-century sandstone building and its contents were fully insured despite delays caused in the installation of a new fire "suppression" system because of the discovery of asbestos.

Experts have said that if the system, which uses chemicals to keep the flames at bay, had been in place the devastating effects of the fire would have been reduced.

Last night a Glasgow School of Art spokeswoman said: "The main archive is in the sub basement and it was protected from fire. As far as we are aware the main archive is intact."

It is not yet known how much it will cost to rebuild the building, though the spokeswoman dismissed claims of £50 million as speculation.

She was unable to say how much the building and its contents were insured for.

She said: "The building and its contents are fully insured for fire and peril. But you have to also bear in mind how much the conservation work is going to cost and other knock-on costs such as how much it will cost to rehouse the school of fine art."

The 1897-99 part of the building has survived intact. This includes the Director's Office and Studio, Mackintosh Museum, Mackintosh Room, Board Room and Furniture Gallery. The GSA Archives have also survived.