PRAIRIE LITHIUM LIMITED — Capital/Financing Update 2011

Jul 25, 2011

ASX Code: ZYL

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26 July 2011

Company Announcements Office Australian Securities Exchange Level 4 Exchange Centre 20 Bridge Street Sydney NSW 2000

Appointment of RSV Enco as BFS Manager

The Directors of emerging metallurgical coal producer ZYL Limited ( ZYL or the Company ) are pleased to advise that RSV Enco Consulting (Pty) Ltd ( RSV Enco ) is being engaged to manage the finalisation of the Bankable Feasibility Study ( BFS ) at the Kangwane Anthracite Project ( Kangwane ).

RSV Enco is an independent consulting engineering and project management company specialising in coal. Based in Johannesburg and servicing both the junior and major end of the resources market, RSV Enco’s current projects include the Riversdale Benga Coal Mine, the Coal of Africa Limited Makhado Coal Project and the Feasibility Study at Xstrata Coal South Africa’s Tweefontein Optimisation Project.

During the first phase of the BFS SRK Consulting, in conjunction with specialist drilling consultant Olympic Park Trading (Pty) Ltd, conducted an independent review and evaluation of the historical exploration and drilling undertaken by Mining Corporation Limited. The review identified key drilling targets and the Company recently completed phase one of its drilling programme totalling approximately 4,000m. The second phase of the drilling program has commenced and this additional 3,000m of drilling is expected to be completed by the end of July 2011.

Once drilling is largely completed and sufficient drill cores have been logged and analysed, RSV Enco will manage the BFS. At this stage RSV Enco will begin collating the drilling results into a geological model with the intention of upgrading the resources, delineating reserves and completing the open-cut mine schedule. This next phase of the BFS will allow ZYL to optimise its conceptual pit designs at the North and South Pits at the Kangwane Project. The full BFS expected to be completed in the fourth quarter of this year.

For further information regarding the Company, please contact the Company on +61 8 9486 4036 or refer to www.zyllimited.com.au

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Yours faithfully,

Dr Eric Lilford Managing Director ZYL LIMITED

About ZYL Limited

ZYL Limited is an ASX listed coal mining and development company operating in South Africa. The Company’s key project, the Kangwane Anthracite Project, is an advanced stage high quality metallurgical coal project located in the Mpumalanga province of South Africa.

The Kangwane Project is well located in close proximity to key infrastructure and coal mining support services and presents the Company with the opportunity to take advantage of both the internal markets of South Africa and the export markets through the use of the Maputo Terminal at the Matola Port in Mozambique.