Frontier Energy Quarterly Update - June 2025

• Multiple definitive proposals received from strategic investors, with preferred party selection anticipated in Q3 2025
• $4.3 million underground cable procurement completed for substation to Landwehr Terminal connection, maintaining October 2027 commercial operations timeline
• 2025 Wholesale Energy Market CIS tender expected to open in August, targeting 1.5GW generation capacity with Frontier positioning for Stage One and Stage Two bids
• Option agreement executed for Pick Lake Zinc Project divestment to Panther Metals for $2.75 million
• Engineering partnership established with Monford Group for EPC preparations

Frontier Energy Limited (ASX: FHE; OTCQB: FRHYF) is an Australian renewable energy developer focused on utility-scale solar and battery storage projects in Western Australia. The company's flagship Waroona Renewable Energy Project comprises a 120MW solar facility with battery storage expansion capabilities targeting October 2027 commercial operations.

The Perth-based company received Capacity Investment Scheme support for Stage One development in March 2025. Development approvals extend to December 2027, with the Definitive Feasibility Study completed in December 2024. The company is pursuing strategic partnerships whilst advancing project development activities.

Progress in Strategic Investor Process for Waroona Project

Following completion of the Definitive Feasibility Study in December 2024, Frontier Energy commenced a strategic partnering process for the Waroona Renewable Energy Project. The company received multiple non-binding indicative offers during the March quarter, with selected parties progressing to stage two of the process. Shortlisted parties conducted site visits, carried out detailed due diligence and participated in Q&A sessions with management.

Multiple parties submitted definitive proposals in June 2025. Frontier has advanced negotiations with selected preferred parties and anticipates confirming its preferred party during the third quarter to enter into exclusive negotiations for binding agreements. The company aims to finalise strategic partnership arrangements to support project development through to commercial operations.

All proposals received remain non-binding and indicative. The company has noted that there is no certainty that a transaction will be finalised on terms acceptable to the Company. The strategic investor process forms part of Frontier's approach to securing capital and partnership arrangements for the Waroona Project development.

Capacity Investment Scheme and Tender Participation

Stage One of the Waroona Project was selected as one of four Western Australian renewable energy projects to receive Capacity Investment Scheme support in March 2025. The CIS is a revenue underwriting scheme aimed at accelerating investment in renewable energy and storage projects, providing a long-term revenue safety net for up to 15 years that decreases financial risk for investors and debt financiers.

The process to finalise the CIS agreement with the Australian Government has been delayed due to several factors, including the federal election, however it is progressing towards an executable form. For the Waroona Project, revenue support applies to the battery component, including electricity sales, reserve capacity payments and essential system services relating to the battery, with solar facility revenue excluded from the CIS calculation.

The 2025 Wholesale Energy Market CIS tender is targeting 1.5GW of energy generation and 0.4GW of battery storage. Frontier expects to submit a bid for the Stage One solar facility which, if successful, would mean the entire Stage One development is supported by the CIS. The company also expects to submit a second application for a Stage Two expansion, currently assessing alternatives regarding size and strategy. The 2025 tender will be condensed to a single stage with assessment period reduced from nine months to six months, expected to open in August.

Project Development Milestones and Non-Core Divestment

Western Power completed procurement of the underground 330kV cable and associated design activities during the quarter. The total cost for procurement and detailed design works was $5.4 million, of which $4.3 million was incurred this quarter. This cable connects the substation to the Landwehr Terminal and represents the critical path long-lead item for the project. No further critical path items related to this programme are outstanding.

The company signed an early works contract with Engineering, Procurement and Construction contractor Monford Group. Monford has experience in renewable energy projects including the Maryborough, Glenellen, Bundaberg and Port Hedland solar farms and the Cunderdin hybrid battery and solar project. Key deliverables under the Early Works Contract include engineering design, various studies and surveys, validation of EPC contract price, updated EPC schedule and confirmation of long lead procurement items.

Frontier Energy entered into an Option Agreement with Panther Metals PLC for the sale of the Pick Lake Zinc Project in Canada for $2.75 million. The agreement provides Panther with an option exercisable until 15 October 2025, with consideration comprising an upfront fee of $100,000 and monthly fees of $30,000. Upon exercise, Panther will pay $2.75 million less amounts already paid, with mining licences and related information transferred to Panther. The company has identified the Pick Lake Project as a non-core asset given its focus on the Waroona Project development.

Conclusion

Frontier Energy reported progress across multiple project development areas during the second quarter of 2025. The company received multiple definitive proposals from strategic investors and anticipates selecting a preferred party during Q3 2025. Critical infrastructure procurement was completed with Western Power finalising the underground cable acquisition and design work. The company positioned for participation in the 2025 WEM CIS tender expected to open in August. With cash reserves of $5.3 million as at 30 June 2025, the company maintains 9.4 quarters of operational funding at current expenditure levels. Management indicated no further major capital expenditures are anticipated prior to strategic investor selection.

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