Mr. Robert A. Kadane, President of KFG Resources Ltd., reported today that KFG Petroleum Corporation, a wholly-owned subsidiary of the Company, ran casing to 5,300 feet for a completion attempt on the No. 1 Ransom well, SE/4 Section 18, T34S-R19W, Comanche County, Kansas. The well had four successful drill stem tests in the Swope, Pawnee, Fort Scott and Mississippi Detrital formations. The Company owns a 24.7% working interest (20.08% net revenue interest) in the well and surrounding 1,692 acres. The well is expected to be completed and on production by early November,2001.

The Company's common shares are listed on the Canadian Venture Exchange, Vancouver, B.C., 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."