The South Korean stock market saw a great deal of change when a South Korean company, Shinil Group, confirmed it has identified the exact location of the 113-year-old sunken vessel Dimitrii Donskoi and claimed there is approximately $133 billion USD worth of gold stored within the vessel.
The salvage team from Shinil Group revealed the vessel was found near Ulleung Island in North Gyeongsang province of Korea, sharing a recorded footage of the Cyrillic “Donskoi” written on the sunken ship to serve as evidence it is indeed the armored cruiser from the 1904-05 Russo-Japanese War.
The Dimitrii Donskoi vessel was lost during the Battle of Tsushima, after enduring attacks by some Japanese warships. This discovery, according to Shinil Group, has pinpointed the location of the vessel to be less than a mile away from the island, 1,424 feet deep underwater.
“This discovery ends the controversy regarding Donskoi’s existence and location. As soon as we wrap up the exploration, we will proceed to register for ownership and rescue the remainder of the vessel.”
— Shinil Group Associate
While Shinil Group argues that it is the first to have located the ship, news reports claim the Korea Institute of Ocean Science & Technology (KIOST) found the vessel in 2003. Several companies, including one by the name of Dong-Ah Construction, have tried to use this discovery to elevate their stock prices.
“A KIOST official explained, seeing from the appearance and characteristics of the vessel, the ship that the institute discovered 15 years ago is the same as the one Shinil Group is advertising to have discovered for the first time.”
— SBS News
Shinil Group disputed the two are different vessels.
Like Dong-Ah Construction, Shinil Group has, since the discovery, strongly suggested that there is an estimate of around 200 tons of gold on the vessel and the ship is worth at least $133 billion. The company has been actively looking for and attracting stock and coin investors, promising returns of the profit from selling the gold once the vessel is rescued.
According to Shinil Group, a Russian admiral onboard left battle records of the Tsushima battle and in this document, the gold is mentioned. Unfortunately, with more experts looking into the matter, doubt continues to form regarding Shinil Group’s “treasure” discovery and its rescue plan.
“We’ve consulted two experts on the Russo-Japanese War. There is no record of such a “Battle of Tsushima Records” document being real. The admiral whom the group claims to have written this document isn’t even on the list of war veterans to have fought in the Russo-Japanese war. Shinil Group is unable to present a physical copy or picture of this document either.”
— SBS News
Some experts don’t believe in the existence of gold altogether.
“It is unlikely the Donskoi, a thickly armored warship with more than 12 artillery pieces, 500 sailors and presumably 1,600 tons of coal, would have had room for 200 tons of gold, which would be double the current gold reserves at South Korea’s central bank.”
— The Guardian
Of course, the salvage of the ship itself is going to pose some difficulties, as the government will get involved — and with Russia vs. Korea ownership disputes anticipated.
“Local laws… require the company to deposit 10% of the estimated value of the shipwreck before starting its salvage works.”
— The Guardian
Experts don’t believe Shinil Group can manage to pay 10% of $133 billion in deposit.
In fact, Shinil Group changed its words when it filed for the ship’s salvage right and estimated the vessel’s worth to be at only $1 million USD, for its wreckage only, to avoid paying a larger deposit to the Ministry of Oceans and Fisheries that has the final call to approve or deny the ship’s rescue.
“No, the ship’s total value has to be written up as the $133 billion worth. The deposit will have to be 10% of $133 billion because the group sold coins and collected investors saying the ship is worth $133 billion. All that would be lies if the group now claims the ship is only worth a million dollars.”
— Pohang Ministry of Oceans and Fisheries Official
This news has triggered the investors to form a group, preparing to take legal action against Shinil Group for falsely advertising the investment opportunity.
Shinil Group faces multiple other obstacles. The ship’s raise, should it be approved, isn’t going to be easy.
“No matter how valuable the vessel turns out to be, dragging a 6,000 ton ship out of the water from 1,400 feet below is simply going to be near impossible.”
— Yonhap News
While Shinil Group awaits the salvage permission decision by the Ministry of Oceans and Fisheries, the South Korean financial supervisory service advised caution.
“Investors should beware because it’s uncertain whether the ship is salvageable and whether Shinil would be able to gain ownership of the assets even if it gets permission to raise it. Dong-Ah Construction made similar claims over the same ship but failed to deliver on its promises and went bankrupt, causing huge losses for investors.”
— Financial Supervisory Service Official