Salvage of century-old Russian warship could unearth billions of dollars in gold

John Bacon | USA TODAY

Show Caption Hide Caption Sunken Russian warship had $130 billion in gold on board That's 200 tons worth of gold.

A South Korean exploration startup says it has a Russian armored cruiser ship that sank more than a century ago and rumored to have a fortune in gold encased in its hull.

The Shinil Group said it found the 6,200-ton Dmitrii Donskoi on July 14 deep in waters off South Korea's eastern Ulleung Island, further confirming the ship's identity in dives the next day. The ship was sunk in 1905 at the Battle of Tsushima during the Russo-Japanese War.

The ship was believed to carry gold being used by the Russians to finance the war along with other wealth belonging to Czar Nicholas II. Shinil estimates the ship could have 200 tons of gold bars and coins aboard valued at more than $130 billion today.

Some Russian scholars have questioned the claim, saying it was unlikely that so much wealth would be stored in one ship. They also questioned whether the ship had room for that much gold. The truth may soon be known.

"The body of the ship was severely damaged by shelling, with its stern almost broken. And yet the ship’s deck and sides are well preserved," the company said in a statement. "The exploration team found a large amount of iron boxes in the stern and will take measures to preserve them."

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A hubbub surrounding the salvage effort already is surfacing.

The Pohang Regional Office of Oceans and Fisheries said Shinil has yet to formally request salvage rights, which require a deposit of 10 percent of the worth of the find. That would mean Shinil, which was formed earlier this year with about $100,000, must come up with more than $13 billion based on the company's estimate of the haul.

Shinil says that so far it has found the shipwreck but no gold, so it believes it must provide a deposit of $1 million. Company spokesman Park Seong-jin said his company will request salvage rights within days.

The company released video shot from a small, manned submarine showing the ship sitting at an angle on the sea floor almost a quarter-mile from the surface. One photo shows a word etched on the ship – the company says it is "Donskoi" in Slavic Cyrillic alphabet.

Contributing: The Associated Press