KFG Resources Ltd. announced today that the Board of Directors of the Company has approved the issuance of an aggregate of 761,335 common shares to Mr. Robert A. Kadane, a Director, President and Chief Executive Officer of the Company, in consideration of the personal guarantees by Mr .Kadane of bank indebtedness of the Company aggregating US $781,674. Of these shares, the issuance of 131,907 shares is subject to prior approval of the shareholders of the Company, and win be submitted to the shareholders of the annual general meeting of the Company to be held in September, 2000. These transactions have been accepted by filing by the Canadian Venture Exchange. Upon final issuance of the aggregate of 761,335 shares, together with options held by Mr. Kadane for the purchase of 300,000 shares, which options are also subject to shareholder approval and which will be submitted for approval at the annual general meeting, give Mr. Kadane beneficial ownership of an aggregate of 1,930,224 common shares, or about 21.29% of the then outstanding common shares of the Company. Mr. Kadane has acquired an of these shares for investment purposes and was not acting jointly or in concert with any person or company. Mr. Kadane, for his own account, may choose to either acquire additional shares, or dispose of shares, depending on economic or market conditions or matters relating to the Company, subject to applicable securities regulatory authorities and requirements.

The Company's common shares are listed on the Canadian Venture Exchange, trading symbol "KFG". For additional information, please contact Mr. Robert A. Kadane, President, at (303) 825- 7080.

The Canadian Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release."