PROSPECT RESOURCES LIMITED — AGM Information 2020

Nov 26, 2020

27 November 2020 ASX.PSC FRA.5E8

XX November 2018 CORPORATE PRESENTATION:

2020 ANNUAL GENERAL MEETING

African lithium developer, Prospect Resources Ltd (ASX: PSC, FRA:5E8) ("Prospect" or "the Company") is pleased to enclose the following Corporate Presentation being given by Managing Director, Sam Hosack at the Company's Annual General Meeting being held at 10am (AWST) today.

*ENDS*

This release was authorised by Mr Sam Hosack, Managing Director of Prospect Resources Ltd.

For further information, please contact: Nicholas Rathjen Head of Corporate Development nrathjen@prospectresources.com.au

About Prospect Resources Limited (ASX:PSC, FRA:5E8)

Prospect Resources Limited (ASX:PSC, FRA:5E8) is an ASX listed lithium company based in Perth with operations in Zimbabwe. Prospect's flagship project is the Arcadia Lithium Project located on the outskirts of Harare in Zimbabwe. The Arcadia Lithium Project represents a globally significant hard rock lithium resource and is being rapidly developed by Prospect's experienced team, focusing on near term production of high purity petalite and spodumene concentrates. Arcadia is one of the most advanced lithium projects globally, with a Definitive Feasibility Study, Offtake Partners secured and a clear pathway to production.

About Lithium

Lithium is a soft silvery-white metal which is highly reactive and does not occur in nature in its elemental form. In nature it occurs as compounds within hard rock deposits (such as Arcadia) and salt brines. Lithium and its chemical compounds have a wide range of industrial applications resulting in numerous chemical and technical uses. Lithium has the highest electrochemical potential of all metals, a key property in its role in lithium-ion batteries.

Prospect Resources Limited | ACN 124 354 329 | W: prospectresources.com.au | Phone: +61 8 9217 3300 Suite 6, 245 Churchill Ave. Subiaco WA 6008 | Email: info@prospectresources.com.au

LOW COST, HIGH PURITY LITHIUM

2020 Annual General Meeting 27 November 2020

Sam Hosack – Managing Director ASX:PSC FRA:5E8

Caution Regarding Forward Looking Information

The information contained in this presentation or subsequently provided to any recipient of this presentation whether orally or in writing by or on behalf of Prospect Resources Ltd ("Prospect Resources or the Company") or its respective employees, agents or consultants (Information) is provided to the recipients on the terms and conditions set out in this notice. The purpose of this presentation is to provide recipients with information relating to Prospect Resources. This presentation has been prepared by Prospect Resources and each recipient must make his/her own independent assessment and investigation of Prospect Resources and its business and assets and should not rely on any statement or the adequacy and accuracy of any information.

Prospect Resources makes no representation or warranty (either expressed or implied) as to the accuracy, reliability or completeness of the Information. Prospect Resources and its directors, employees, agents and consultants shall have no liability (including liability to any person by reason of negligence or negligent misstatement)for any statements, opinions, information or matters (express or implied) arising out of, contained in or derived from, or for any omissions from the presentation, except liability under statute that can not be excluded.

This presentation contains references to certain intentions, expectations and plans of Prospect Resources. These intentions, expectations and plans may or may not be achieved. They are based on certain assumptions which may not be met or on which views may differ. The performance and operation of Prospect Resources may be influenced by a number of factors, many of which are outside the control of Prospect Resources. No representation or warranty, express or implied, is made by Prospect Resources or its respective directors, employees, officers, agents, consultants or advisers that intentions, expectations or plans will be achieved either totally or partially or that any particular rate of return will be achieved.

This presentation does not constitute in any way an offer or invitation to subscribe for securities in Prospect Resources pursuant to the Corporations Act 2001 (Cth).

Competent Person's Statements

The Company confirms it is not aware of any new information or data that materially affects the information included in the Arcadia Mineral Resource Estimate and that all material assumptions and technical parameters underpinning the estimate continue to apply and have not materially changed when referring to its resource announcement made on 25 October 2017.

The Company confirms it is not aware of any new information or data that materially affects the information included in the Arcadia Ore Reserve Estimate and that all material assumptions and technical parameters underpinning the estimate continue to apply and have not materially changed when referring to its reserve announcement made on 20 November 2019.

Lithium, project development and African mining experience Board of Directors and Executives

Agenda

Overview of proxy votes

Resolution	FOR	AGAINST	EXCLUSION/ABSTAIN	DISCRETIONARY
Resolution 1 –Remuneration Report	58,411,027	214,068	14,185,460	4,000
Resolution 2 –Re-election of Gerard Fahey as Director	72,708,257	79,568	14,730	12,000
Resolution 3 –Re-election of Zivanayi (Zed) Rusike as Director	72,706,314	81,511	14,730	12,000
Resolution 4 –ASX Listing Rule 7.1A of Future Issue of Securities	71,998,415	368,168	435,972	12,000
Resolution 5 –Ratification of Prior Issue of Shares	61,501,964	170,168	11,130,423	12,000
Resolution 6 –Ratification of Prior Issue of Shares	56,439,599	64,817	10,161,539	8,000

Resolution 1 Remuneration Report

To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution:

"That, for the purpose of Section 250R(2) of the Corporations Act and for all other purposes, approval is given for the adoption of the Remuneration Report as contained in the Company's Annual Financial Report for the financial year ended 30 June 2020." PROXY VOTES

	VOTINGINTENTION	NUMBER	%
	For	58,411,027	99.63%
	Discretionary	4,000	0.01%
	Against	214,068	0.37%
	Total validdirected proxiesreceived	58,629,095	17.65%
	Exclusions/Abstain	14,185,460	NA

Resolution 2 Re-election of Gerard Fahey as Director

To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution:

"That Gerard Fahey, a Director who retires by rotation in accordance with the Company's Constitution and ASX Listing Rule 14.5, and being eligible offers himself for re-election as a Director of the Company, effective immediately." PROXY VOTES

	VOTINGINTENTION	NUMBER	%
	For	72,708,257	99.87%
	Discretionary	12,000	0.02%
	Against	79,568	0.11%
	Total validdirected proxiesreceived	72,799,825	21.92%
	Exclusions/Abstain	14,730	NA

Resolution 3 Re-election of Zivanayi (Zed) Rusike as Director

To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution:

"That Zivanayi (Zed) Rusike, a Director who retires by rotation in accordance with the Company's Constitution and ASX Listing Rule 14.5, and being eligible offers himself for re-election as a Director of the Company, effective immediately." PROXY VOTES

	VOTINGINTENTION	NUMBER	%
	For	72,706,314	99.87%
	Discretionary	12,000	0.02%
	Against	81,511	0.11%
	Total validdirected proxiesreceived	72,799,825	21.92%
	Exclusions/Abstain	14,730	NA

Resolution 4 ASX Listing Rule 7.1A Approval of Future Issue of Securities

To consider and, if thought fit, to pass the following resolution as an Special Resolution:

"That, for the purposes of ASX Listing Rule 7.1A and for all other purposes, the Shareholders approve the issue of equity securities up to 10% of the issued capital of the Company (at the time of issue) calculated in accordance with the formula prescribed in ASX Listing Rule 7.1A.2 and otherwise on the terms and conditions set out in the Explanatory Statement which accompanies and forms part of this Notice of Meeting."

	VOTINGINTENTION	NUMBER	%
PROXY VOTES	For	71,998,415	99.47%
	Discretionary	12,000	0.02%
	Against	368,168	0.51%
	Total validdirected proxiesreceived	72,378,583	21.79%
	Exclusions/Abstain	435,972	NA

Resolution 5 Ratification of Prior Issue of Shares

To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution:

"That, for the purposes of ASX Listing Rule 7.4 and for all other purposes, the Shareholders ratify the allotment and prior issue of 17,560,195 fully paid ordinary shares issued on Tuesday 20 October 2020 and otherwise on the terms and conditions set out in the Explanatory Statement which accompanies and forms part of this Notice of Meeting."

	VOTINGINTENTION	NUMBER	%
PROXY VOTES	For	61,501,964	99.70%
	Discretionary	12,000	0.02%
	Against	170,168	0.28%
	Total validdirected proxiesreceived	61,684,132	18.57%
	Exclusions/Abstain	11,130,423	NA

Resolution 6 Ratification of Prior Issue of Shares (Listing Rule 7.1A)

To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution:

"That, for the purposes of ASX Listing Rule 7.4 and for all other purposes, the Shareholders ratify the allotment and prior issue of 28,593,652 fully paid ordinary shares issued on Tuesday 20 October 2020 and otherwise on the terms and conditions set out in the Explanatory Statement which accompanies and forms part of this Notice of Meeting."

	VOTINGINTENTION	NUMBER	%
PROXY VOTES	For	56,439,599	99.87%
	Discretionary	8,000	0.01%
	Against	64,817	0.11%
	Total validdirected proxiesreceived	56,512,416	17.02%
	Exclusions/Abstain	10,161,539	NA

Company and project update

Corporate overview

A unique, low cost and high quality lithium development specialist

7 th largest hard rock lithium asset globally – with DFS and fully permitted 1

Offtake agreements secured with tier one partners across Europe and Asia

3

4

Pilot plant launching H1 2021 to produce high purity petalite & spodumene. Targeting near term, low capex staged development

Management is invested. $572k invested in May 2020 & hold 7% of shares on issue

2020 Review A year of tangible progress of Arcadia

Delivered on:

• Preliminary product qualification with customers
• Offtake Agreement Petalite Agreement with Sibelco
• Appointment of M&A advisor Renaissance Capital to assist with Uranium One
• Development of high purity petalite product, increasing recovery and product quality
• Plan to extract value from non-core assets
• Clear pathway to production through staged expansion

	MOU signed	Completion ofEntitlementIssue13 May	Appointment ofRenaissanceCapital6 July	Petalite flotationtestwork doublespetalite recoveryand 4.5% Li2O24 July	Petalite OfftakeAgreementsigned withSibelco17 August	Share placementto fast trackArcadia14 October	option for US$1M23 October
Petalite passessecond productqualification stage6 January	with Sibelco27 April

Penhalonga Gold Project under

Development of high purity lithium pilot plant 11 November

Tier one partners secured Offtake agreements in place across Europe & Asia

• 7 year offtake agreement for:
  • 40,000tpa of 6% spodumene concentrate;
  • 112,000tpa of 4% petalite concentrate; and
  • US$10m pre-payment
• A$10m equity investment in Prospect Resources1
• 7 year term for up to 100,000tpa of a 4% petalite concentrate
  • World's largest known ultra-low iron petalite offtake agreement
  • Sibelco's has been processing petalite for over 40 years

Pilot Plant On schedule to ship high purity lithium samples in H1 2021

• Pilot Plant designed to replicate commercial size operations:
  • ANZAPLAN validated flotation testwork
  • Beijing General Research Institute of Mining & Metallurgy (BGRIMM) flotation technology
  • Engineering design done by ADP Marine & Modular
  • Produce products to specification and quality representative of planned operations
• First shipment of product to customers in H1 2021, with planned production of:
  • 500t of petalite
  • 120t of spodumene

Clear pathway to production Staged development, producing of high purity products

H1 CY2021	PILOT PLANT	✓Production of high purity samples for customers✓Optimise flowsheet and design for FEED✓Supplying samples to Uranium One Group for theircontinuing due diligence
CY2022	Stage 1: SINGLE TRAIN PLANT	✓Low capex hurdle✓Produces sizeable volumes of high purity petalite and spodumene✓Opportunity to rapidly commence production and scale up plant
CY2023-25	Stage 2: DUAL TRAIN PLANT	✓Capex expansion as brownfield operation✓Increasing production further strengthening cashflow✓Further expansion potential to 2.4Mtpa DFS levelsCurrent offtake agreements are up to 100% oflithium production at dual train stage
	Further expansion potential

EV adoption accelerating Lithium Market

• UK and Europe leading the way. Set to become the largest EV market of 2020
• In order for the UK to meet their EV target, it needs:
  • Half of the world's 2020 lithium supply to meet future battery capacity challenge1
  • Half of the worlds lithium produced in 2020 (49% of 315,000 tonnes LCE in 2020)
  • More than the entire world's supply of anode material in 20201
• Customer feedback suggesting higher prices in 2021 across both the chemical and glass & ceramics markets

Chart: INSIDEEVs

Chart: Jato

Without further investment, the market is in deficit by 2021 Lithium Market

Shortage of long-term supply

• Existing operational supply only in place to meet demand to 2021
• For additional producers to meet the demands of the market in 2022, development would have had to commence in 20191
• Therefore without further investment in new projects there will be a supply shortage by 2022 where EV growth will accelerate as they reach cost parity with ICE vehicles

LCE= Lithium Carbonate Equivalent

I I 21 1 Assuming development and ramp up phase of 24 months

2 Bernstein 3

Identified potential supply is a collection of Benchmark Minerals Intelligence's highly probable, probable and possible supply categories

Pathway to production in a supply constrained market

✓ Arcadia petalite passes secondary qualification stage

• ✓ Appointed Renaissance Capital for dealings with Uranium One

• ✓ Petalite flotation almost doubles recovery

• ✓ Offtake Agreement signed with Sibelco for petalite

• ✓ Secure funding and commence development of pilot plant to produce high purity petalite & spodumene

• Arcadia – Stage 1 Construction finance

• Arcadia – Final Investment Decision

• Arcadia – Commence construction

✓ Potential sale of non-core assets

2020	H1-2021	H2-2021	2022-2023
	•Production of high purity samples to complete finalqualification process with glass & ceramics customers		•Arcadia –Production
	•Pilot plant to generate process improvements		•Stage 1 production designed for offtake partners,with small capex and rapid development
	•Complete FEED with the inclusion of petalitefloatation technology		•Generate operating cashflows
	•Continue tantalum offtake discussions		•Staged expansion in line with cashflow
	•Continue project finance discussions

2 Resolutions, proxies and voting

3 Company and project update

CONTACT US

Nick Rathjen Head of Corporate Development Mobile: +61 405 730 041 Email: nrathjen@prospectresources.com.au

www.prospectresources.com.au