After 147 years buried at the bottom of the ocean, the remains of the Flying Cloud shipwreck off the south-east South Australian coast have been discovered.

Keen shipwreck hunter 19-year-old Carl von Stanke was diving near Carpenter Rocks on Saturday with his friend, 20-year-old Santiago Neumann, when the pair spotted an unusual formation, encrusted with seaweed, on the ocean floor.

"At first, I didn't know what it was," Mr Neumann said.

"I just saw this very straight rock and thought, 'that might be something', so I called Carl over."

The pair had stumbled across the anchor chain tethering two main anchors from the old ship. Surprisingly, the chain was still pulled taut after decades of battering by ocean currents.

"It was very hard to recognise what was left unless you actually knew what you were looking for," Mr von Stanke said.

"It was very exciting to find it. The amount of time I've been looking for it has finally paid off.

"There wasn't much left of it. It has had a lot of time to deteriorate in the water."

One of the anchors of the Flying Cloud, now covered in marine life. ( Supplied: Carl von Stanke )

It was a foggy night in April 1870 when the sugar-laden brig struck trouble, hitting a reef near Cape Banks.

The Captain, his wife and child, and six crew were able to safely reach the shore in boats, leaving the ship at the mercy of the ocean — one of more than 200 vessels to be wrecked or lost in South Australian waters between 1837 to 1924.

The Flying Cloud is the fourth shipwreck that the young diver has played a role in locating, including the Iron Age, the Lotus, and the Hawthorn.

Hard work pays off

Four years of painstaking research has gone into the hunt for the Flying Cloud, with Mr von Stanke scouring old newspaper reports and history books to pinpoint where the remains might lie.

"There is a lot of work and research that goes into it," he said.

Carl von Stanke and Santiago Neumann found the remains of the Flying Cloud shipwreck after years of research. ( ABC South East SA: Kate Hill )

"First of all you have to look at what the location is like, does it have lots of reefs, deep water or shallow, what was the weather like at the time.

"You go back through old books and newspapers and see what they say. Time changes and everything changes around it. What was there 150 years ago is definitely not going to be there now."

Over the years, Mr von Stanke narrowed his search down to three square kilometres, saying he 'had a hunch' where the remains might be.

Upon finding it, the first person to hear the good news was Mr von Stanke's father, Gary von Stanke, a man with a keen interest in shipwrecks and local history himself.

"He called me and said, 'I found it Dad, I found it!'," Mr von Stanke said, laughing at the memory.

"Carl was determined he was going to locate that wreck," Mr von Stanke senior said.

Mr von Stanke said his son had become fascinated by shipwrecks when he was just a little boy and they went on to become an important part of his teenage years.

"Shipwrecks became a passion for him. He was always up at the library researching and going through the old papers," he said.

The State Heritage Unit, which documents and manages the state's shipwrecks, had made numerous visits to try to locate the wreck in previous years, along with Flinders University researchers.

Divers may have stumbled upon the wreck earlier, Gary von Stanke said, but due to significant decay and coverage by marine life, might not be aware what it was.

"For their own reasons, maybe a couple of ab divers have found it and kept it quiet," he said.

"A lot of the older ones would have passed on so that history has unfortunately been lost."

A piece of the Flying Cloud's hull, which became part of a house at Millicent. ( ABC South East SA: Kate Hill )

The family also has a piece of the Flying Cloud's wooden hull, which bizarrely ended up as part of a house at Millicent.

"When it was wrecked, some of the locals here bought the rights to it and salvaged some of the timber from it," Mr von Stanke said.

"They built a house at Millicent with it and that was there, right up until the 1980s until it was bulldozed.

"There were timbers, fittings and they also had the original canvas sail from the ship."

Wreck location kept under wraps

The wreck's exact location and all Mr von Stanke's research will now be handed over to the State Heritage Unit.

He said the wreck's exact location will remain a secret until they are able to properly document the wreck, to guard against souvenir hunters.

"You can't touch it or take anything from it. Any wreck that is over 75 years old automatically comes under State Heritage protection," Mr von Stanke said.

Mr von Stanke found the wreck just two days before he was due to leave for Queensland, where he is a private with the Australian Army.

But when he returns home again late next year, his local maritime history work will begin again.

He said there were still plenty of undiscovered shipwrecks waiting to be found.

"I just enjoy doing it," he said.

"Looking at something that no-one else has seen before, it's pretty incredible."