'We lost all the beer': Family rescued after boat sank off Queensland coast

A Queensland family of eight with a baby were dramatically rescued from a tiny lifeboat after their vessel took on water and began to sink.

But while they waited to be rescued, they were in high spirits, noting that everyone was safe but they had lost all their booze.

The Nugent family, including three children - one an eight-month-old baby - were out on the water in their 8m boat, en route to North West Island off the coast from Rockhampton on Friday, when they got into trouble.

"We're not too sure what happened," James Nugent told 7News. "We were travelling out and heard like a bit of a thud... Next thing we know there's water squirting up on to the board."

The baby apparently slept right through the whole affair.

The Australian Maritime Safety Authority were alerted by their emergency beacon going off, giving the group's position at 77km east of Yeppoon in Queensland.

"The vessel had eight people on board and was taking water and sinking, passengers donned lifejackets and abandoned the vessel," the authority said.

Several members of the group were in the ocean, treading water, while holding on to the side of the lifeboat.

But they didn't seem too worried, laughing and joking while filming a video.

"The little fella, he slept all the way through it, everyone's safe - and we lost all the beer.

"Just another day, being rescued."

The group could see rescue helicopters circling and were picked up by the RTM Twarra.

The authority sent a jet, two rescue helicopters, and a number of smaller craft to rescue the group but in the end they were picked up by the RTM Twarra, a bulk carrier ship.