"Thursday, June 5, 2003

Mr. Robert A. Kadane, President of KFG Resources Ltd. announced Company's subsidiary KFG Petroleum Corporation, Natchez, Mississippi, is moving in to drill an east offset to its Board of Education 30-14 well located in Section 30, T6N, R2S, Franklin County, Mississippi. The 30-14 well was drilled in 1996 and has produced in excess of 150,000 barrels of oil from the McShane Sand at 6,370 feet, and is currently producing 63 BPOD.

The proposed drillsite, the Board of Education #3, is approximately 1,300 feet southeast of the 30-14 producer, and will be drilled by the Company's subsidiary, Shamrock Drilling Inc. The Company has a 18.43% working interest (13.826% net revenue interest) in the well and surrounding 120 acres.

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

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