FACSIMILE TRANSMISSION

ASX Code: SHE


29 July 2015

Market Announcements Platform

ASX Limited, Exchange Centre,

20 Bridge Street, Sydney NSW 2000

PROTEAN™ WORKSHOP TESTING COMPLETE AND WET TESTING UNDERWAY

Fully assembled workshop testing now complete

Ocean based wet testing to commenced

Stonehenge Metals Limited (Stonehenge, or the Company) is pleased to advise that the fully assembled workshop testing of the core energy conversion system components of the Protean™ Wave Energy Converter (WEC) has now been successfully concluded. Building on the success of the workshop testing, the Protean™ WEC technology program has now advanced to the ocean based or "wet" testing phase.

Stonehenge MD, Bruce Lane said "The successful conclusion of the workshop testing of the single proof of commercial applicability device was the next major milestone in our program to accelerate commercialisation of the Protean™ WEC technology. We are excited to now be moving the technology into the ocean based wet testing phase."

Fabrication of the 30 WEC buoy array, which will make up the planned demonstration wave farm, is expected to commence once the wet testing of the individual buoy is successfully concluded.

The Company remains focused on proving the commercial applicability of the technology through local, national and international collaborations with both existing and new supporters of the Protean™ WEC system.

For further information see www.stonehengemetals.com.au,www.proteanwaveenergy.com.auor contact:

Bruce Lane - Managing Director

T: + 61 8 9481 2276

E: blane@stonehengemetals.com.au

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ABOUT THE PROTEAN WAVE ENERGY CONVERTER (WEC) TECHNOLOGY


Stonehenge has entered into an option agreement to purchase the Protean WEC technology. The Protean WEC system is based upon a point-absorber wave energy converter buoy device, which floats at the water surface and extracts energy from the waves by the extension and retraction of a tether to its anchoring weight on the seabed. The device is unique in that it optimises the conversion of energy from waves at the surface through all six degrees of wave movement.

Figure 2: Protean WEC technology

The Protean WEC has been developed to use compact architecture to produce power from a small, low cost, scalable design targeted at keeping the projected levelised cost of energy (LCOE)1 down. The Protean WEC has been designed to be cost competitive to manufacture, deploy, maintain and retrieve. The future plans for the Protean WEC include the deployment of a pre-commercial demonstration of a dynamic, configurable and scalable power array prior to moving the technology into early commercialisation. During the Option period the Stonehenge assessment program aims to:

1. Refine the tried and proven scale device to produce a suitable pre-commercial model;

2. Create a scalable power array so as to provide the power requirements of a prospective customer;

3. Test the scalable power array for its potential to deliver cost effective power;

4. Verify the results, including commissioning of an independent expert to qualify the testing results; and

5. Commence commercialisation of the scalable array for small to medium customers.

Protean Wave Energy Converter (WEC) Design, Construction and Deployment

For further information visit: www.proteanwaveenergy.com.auor

www.stonehengemetals.com.au

1 Levelised cost of energy is one of the industry's main metrics for the cost of electricity produced. It accounts for all of a system's expected lifetime costs (incl. construction, finance, fuel, maintenance, tax, insurance & incentives), which are then divided by the system's lifetime expected power output (kWh) & discounted for inflation & time cost of money.

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