The Waratah Gypsum Company had works here for the quarrying and exporting of rock gypsum. Gypsum after being washed, roasted and ground, was used in the manufacturing of plaster of paris and cement. The quality of the gypsum in this area was exceptionally high class and most of Australia's needs were supplied from here.
The Waratah Gypsum Company closed its works and the town was sold to the South Australian Government which demolished the town except for the few houses required for the rangers of the National Parks and Wildlife Organization who look after Innes National Park.
After almost 60 years, the shop at Stenhouse Bay, trading in recent years as Innes Park Trading Post and Rhino’s Tavern, was demolished before Christmas in 2013.
The iconic trading post and tavern was closed and fenced off just before the peak Christmas period. Park visitors must now travel 5km out of the park to Marion Bay for fuel, camping goods and a restaurant meal. The closure meant the department lost between $30,000 and $50,000 in annual lease revenue.