Page 1

Prospect Resources ASX.PSC FRA.5E8 ASX ANNOUNCEMENT 26 October 2021 QUARTERLY ACTIVITIES REPORT FOR THE QUARTER ENDED 30 SEPTEMBER 2021 Prospect Resources Ltd ( ASX : PSC , FRA : 5E8 ) ( Prospect or the Company ) is progressing its world- class Arcadia lithium project ( Arcadia or the Project ) and is pleased to report on activities undertaken in the September 2021 quarter and its financial position at the end of the period . Project Development • Completed the transaction to increase the Company's interest in the Arcadia Lithium Project to 87 % ; • Commenced and advanced a competitive partnership process , whereby interested parties have the opportunity to undertake due diligence and put forward proposals to partner and fund Arcadia ; • Exercise of the Meikle Option Agreement and encouraging results from the Chishanya Rare Earth soil sampling programme , with an assessment of further regional explorations targets underway ; and • Operated the pilot plant and subsequent to quarter end , finalised a bulk technical grade petalite shipment to Sibelco and released the Staged Optimised Feasibility Study ( Staged OFS ) Finance & Corporate • Executed Penhalonga Gold Option Agreement • As at 30 September 2021 , Prospect was debt free with a cash balance of A $ 5.7M . Managing Director , Sam Hosack , commented : " The September 2021 quarter was focused on the further development of Arcadia and extracting value from our other assets . We completed the Farvic transaction , increasing Prospect's ownership in Arcadia to 87 % and operated the pilot plant and shipped on - spec technical grade petalite concentrate . Our key focus is to showcase Arcadia's technical grade petalite to our existing off - takers and their customers in the global glass and ceramics markets . " " The appointment of Azure Capital and Vermilion Partners as advisers to run a structured partnership process aims to leverage the extensive inbound interest we have received in the Arcadia Project . The objective of the partnership process is to introduce a competent and aligned partner to provide funding and work alongside Prospect in bringing Arcadia into production , on terms that are favourable to Prospect's shareholders . I am very pleased with the level of engagement with the potential partners in the process and have received positive feedback regarding the quality of the team's work in the Staged OFS recently released . Prospect Resources Limited ACN 124 354 329 Level 2 , 33 Richardson Street . West Perth WA 6005 E : info@prospectresources.com.au W : prospectresources.com.au