On June 4, 1997, approximately 1117 mountain daylight time, a Cessna 177B, N34680, registered to and operated by Scenic Airlines, Inc., and being flown by a commercial pilot, was substantially damaged during an intentional ditching in the San Juan River slightly east of its entrance into Lake Powell, Utah. The ditching was executed by the pilot-in-command (PIC) following a loss of engine power. The pilot and three passengers (German nationals) exited the aircraft with no injuries with the exception of the PIC, who sustained minor injuries. Visual meteorological conditions prevailed and no FAA flight plan was in effect. The flight, which was a sightseeing flight, was to have been operated under 14CFR135, and originated from Page, Arizona, at 0909 with 40 gallons of fuel. The pilot reported in both a telephonic interview with the Investigator-in-Charge, and a written statement, that a little over two hours after takeoff the aircraft's engine began to lose power. At this point he was located just north of No Mans Mesa (refer to CHART I) flying westbound along the San Juan River which feeds into Lake Powell. The pilot reported that he was "following the lake westward just above the tops of the cliffs that enclose it." The pilot attempted to trouble-shoot the power reduction during which the aircraft began losing altitude and he reported that he "could not locate a suitable landing site on land." He then prepared his passengers for a water landing and ditched the aircraft under partial power in the vicinity of a nearby pleasure boat. The pilot reported that during his trouble-shooting efforts he noted that the manifold pressure "was good (1 or 2 inches above the top of the green)" and that "the RPM was falling slowly." He indicated that the RPM initially was at 2100 and had decreased to 1800 before the ditching. He also reported seeing "the oil temperature was 1 needle out of the red" and described the engine sound as "popping and backfiring and shuddering worse and worse all the way down" (refer to attached statement). The pilot reported that he lowered full flaps and slowed the aircraft down as much as possible prior to the water landing. Upon impact, the aircraft nosed over to an inverted position almost immediately, and the pilot and three passengers exited the aircraft, which sank in about 15 seconds. Attempts to locate the aircraft in the deep water within the gorge terrain were unsuccessful and the aircraft was not recovered (refer to CHART I which shows the approximate ditching location).