Mr Mitchell was walking along the beach past Warrnambool Surf Life Saving Club towards The Flume just after 2pm when he noticed a gutter of water close to the sand.

At the moment when Ziggy, a German short-haired pointer, bounded past his owner into the water, Mr Mitchell saw a shark he guessed was up to five feet (1.5 metres) long.

“It wasn’t huge, and I could see the whole shark because it was clear water,” he said.

Mr Mitchell then realised his dog Ziggy was trying to jump on top of the creature, but fortunately he was unsuccessful.

"(Ziggy) tried to jump on him into deeper water and he made a big splash that scared him away,” he said.

Mr Mitchell, a long-time surfer and fisherman who has spent his entire life living in and around Warrnambool, said he was surprised to see any kind of shark in that area.

“I’m glad there was no one around. There’s usually people swimming near the life saving club,” he said.

The regular walker said he hadn’t been scared, but described the experience as “so different”.

Warrnambool Surf Life Saving Club president Michael Owen said no official reports of a sighting had been made, but some members had had a look around after hearing about the incident.

Mr Owen said the members had not located a shark.

Fisheries Victoria director of education and enforcement Ian Parks said the size of the shark Mr Mitchell saw indicated it was a “low hazard” shark.

“The small sharks like that are not the dangerous sharks that have been reported recently over Christmas-time and so on,” Mr Parks said.

“They’re not really a dangerous shark like the white sharks and the large three-metre types of sharks.

“Obviously any types of sharks can bite someone but these aren’t dangerous sharks that will bite someone unless they try to antagonise it.”

Mr Parks said people should check emergency.vic.gov.au/ for information before heading out to swim and ring 000 to notify police if they spot larger, more dangerous sharks.