The Prospector's Tool is a consumable tool used by miners. It is also a one-handed Mace Fighting melee weapon. It can be gotten by completing and returning Blacksmithy Bulk Order Deeds. The tool has an item property of Uses Remaining; when that value reaches 0, the tool is destroyed.
The Prospector's Tool allows a miner to increase the level of ore found in a particular area by one level. For example, if a mining location yields Verite, the use of this tool will cause Valorite to be the result. Think of it as an ore vein upgrade. The tool can be used in combination with the Gargoyle's Pickaxe to raise a vein two levels (e.g., Agapite to Valorite).