Pearling mothership the Sanyo Maru was a lifeline for thousands of Japanese divers who plundered waters off Arnhem Land in the late 1930s.

"This ship is part of a hidden history of a foreign fleet that came south and dominated," says maritime archaeologist Dr David Steinberg.

"They had more divers, more boats, better infrastructure and it knocked the local pearlers out of the water."

The 280 tonne Sanyo Maru was at the centre of that fleet at a time when the Australian maritime border ended three nautical miles offshore.

Thousands of Japanese workers toiled on hundreds of ships in the Arafura Sea, harvesting pearl shells in the years before WWII broke out in the Pacific.

Local journalist Terry Southwell-Keely described it at the time as a "floating foreign township" with a population exceeding many northern Australian communities.

"In the space of a few years they have developed a highly efficient and organised industry," he wrote in 1938.

It was a thorn in the side of Australian authorities, "infuriating them" as a precious resource was exploited, local pearlers were displaced and a homegrown industry destroyed.

Japanese lugger crews were not welcome in Darwin where they were "regarded with suspicion despite being generous spenders", according to Southwell-Keely.

They were also forbidden from landing at Boucaut Bay, 500km east, and the islands near to where the fleet worked.

"They had to bring all their own water and firewood but some secretly landed on the beaches," Steinberg says.

"There were not enough patrols to stop them and when they did they had great contact with the Aboriginal people."

This included trade, with some Japanese shell divers paying the Yolngu people to beach their boats in secret island coves during big spring tides when they could not work.

"They were peacefully negotiating with Aboriginal landowners in the 1930s and disregarding the Australian government," he says.

The Sanyo Maru was the largest ship in the fleet and her crew of 20 delivered supplies from its base in Micronesia and collected shells for export back to Japan every fortnight.

"They would anchor together when they were not working and play music and trade and the Sanyo Maru would bring newspapers and letters from home," Steinberg says.

"It was their company store and hospital."

Southwell-Keely colourfully described her as an "emporium chocked with merchandise and tinned food that was eagerly awaited by the lugger crews".

"Individual requirements are catered for from fishing lines and hair oil to sweet meats," he said.

"Crews crowded the railings shouting greetings and exchanging jokes and calling for news."

In the days before she sank in 1937, the Sanyo Maru had unloaded water, fuel and food and taken on a huge haul of pearl shell.

"It was dangerously overloaded and there was massive squall and they got caught in that storm," Steinberg says.

Two men drowned as the fleet scrambled to rescue the surviving sailors and the Sanyo Maru slid 26 metres below the surface and into the muddy darkness.

Her exact location remained unknown until Steinberg and traditional owner Peter Danaja started investigating the wreck more than 20 years ago.

A long-forgotten letter from the Japanese government to Australia about salvaging the vessel provided clues that the Royal Australian Navy used to find the ship in 2001.

"It is very remote and that increases the risk. It's not massively deep but it's deep enough to be serious and then there are the currents that affect visibility," Steinberg says.

He has since dived on the wreck during various expeditions and recovered dozens of items including ceramic dinnerware, chopsticks, saki jars, lacquerware, surgical kits and diving gear.

They have provided a never before seen glimpse into life aboard the Japanese fleet that worked far from its home in northern Australia for about five years.

"It petered out in about 1938. They over-capitalised and exploited the area and wiped it out," Steinberg says.

"Some of the boats worked until 1941 and hung about to help some Japanese residents escape northern Australia when war broke out."

The story of the Sanyo Maru and the artefacts found at the wreck are currently on display in an exhibition at the Australian National Maritime Museum in Sydney.

Steinberg is past president of the Australasian Institute for Maritime Archaeology and senior heritage officer for NT Government.

He has just completed a doctorate in maritime archaeology on the Sanyo Maru and Japanese pearling in the territory.

The wreck is protected by the Underwater Cultural Heritage Act.

Australian Associated Press