Robert A. Kadane, President of KFG Resources Ltd., announced today that KFG's subsidiary, KFG Petroleum Corporation, started gas sales on November 3, 2000, from its #1 Barton well in East Feliciana Parish, Louisiana. The well was completed flowing 181,000 cubic feet of gas per day. The Company's working interest in this well and the surrounding 160 acre drillsite is 88.75%, net interest 65.56%. The Company's working interest in the remaining Barton prospect of 8,383 acres is 63.75%, 47.85% net.

The #1 Barton will be thoroughly tested at flow rates for about 90 days before additional development starts. As of now, the plans are to drill two wells in the area in February, 2001, and two more wells in the area in May, 2001, with plans to accelerate development by the fall of 2001.

Mr. Kadane also reported that KFG Petroleum successfully re-entered the Lottie K. Gibson #I well in Catahoula Parish, Louisiana. This well was completed flowing 225,000 cubic feet of gas per day. The Company has a 90% working interest (75% net interest) in this well. The well is hooked up to a pipeline connection about 1,000 feet from the well location, and gas sales began November 7, 2000, to the town of Harrisburg, Louisiana, about three quarters of a mile from the well.

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."