Talk to Roxy on DS9 in the Omega Force kiosk right outside the shipyard. You can turn it in for either dilithium or a requisition. If it's Common, you can select either a Mk 10 Special Reserve Engine Req or 1000ish dil (dil is better, since mk 10 gear is bottom of the 'special reserve'). Rare, Mk 11 gear or 1000 dil, and the best you can get on normal difficulty. Prototype is what everyone is truly hunting for in STFs, and its a waste if you turn that in for dilithium over the engines.