KGL RESOURCES LIMITED — Capital/Financing Update 2009

Oct 19, 2009

ASX / MEDIA RELEASE

20 October 2009

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KENTOR GOLD LTD

ACN 082 658 080

Exercise of option to purchase Andash project

 Targeting production in 2011

Kentor Gold Limited (ASX code: KGL) (Kentor or the Company) is pleased to announce that the Company has exercised the option to purchase the Andash gold-copper project in the Kyrgyz Republic.

The payment to Aurum will take place in late December 2009 and Kentor are now moving to finalise the financing.

Announcing the decision, the Managing Director of Kentor, Simon Milroy, said:

“ This is an important step in the transition of Kentor from explorer to significant gold producer.

“ For more than 10 years, Kentor has been established in the Kyrgyz Republic, with strong management permanently located in the country, exploring and pursuing resource acquisitions.

“ The Company is well prepared to proceed with the development of the Andash project. ”

Aurum Mining PLC, the vendor, will now seek the approval of its shareholders for the acquisition. The Shareholder meeting is scheduled to be held in early November.

The total acquisition cost is US$15 million including the Mining Fleet. At the time of signing the MOU to purchase the Andash project, the Australian/IUS exchange rate was to approximately $0.80. As of 16th October 2009 the rate is over $0.91. On a consideration of US$15,000,000 this means an effective reduction in the AUD equivalent of approx $2.4 million.

Work has already commenced on updating the project Feasibility Study. As previously announced, GRD Minproc has been engaged to perform this work, expected to be completed in March 2010. The update is aimed at revising the operating and capital estimates on the project. Additionally, the mine plan will be reviewed in order to optimise the mine scheduling and minimise the upfront capital costs.

About the Andash Project

The high grade, low cost project is targeted for production in 2011 at the average annual rate of 60,000 oz gold and 5,000 tonnes copper for eight years.

Andash is located in the Tien Shan Gold Belt, one of the world ’ s major gold provinces spanning central Asia. Kentor is exercising an option to purchase an 80% interest in Andash.

Situated in the gold-rich Talas region, the Andash project will benefit from extensive existing infrastructure, including low cost power and an available workforce. The near-surface deposit has a proposed strip ratio of 0.8:1, and the ore is metallurgically simple to process.

Registered Office Level 36 Riparian Plaza, 71 Eagle St Brisbane 4000 Phone: 61 (0) 7 3121 3206

Kyrgyz Republic Office 235/2 Erkindik Prospect, Bishkek Kyrgyz Republic 720739 Phone: +996 312 621 389

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www.kentorgold.com.au

About the Company:

Kentor Gold Limited (ASX Code: KGL) is an Australian-based company formed in 1998 as a specialist gold explorer. The Company was listed on the Australian Securities Exchange (ASX) in March 2005 and has diversified into exploration for gold, geothermal energy and base metals in Central Asia, where it has highly regarded, established local management.

Kentor is working towards the development of two gold mines in the Kyrgyz Republic:

• Andash, targeted for production in 2011 at the currently planned rate of 60,000 oz gold and 5,000 tonnes copper per year for eight years - and

• Savoyardy, proposed to commence in 2010 at the initial rate of 10,000 oz gold per year for a minimum three years subject to final decision later this year - Kentor has an option to purchase 100 per cent of the project.

For further information contact:

Mr Simon Milroy Managing Director Phone: (07) 3121 3206 or 0448 851575 Email: info@kentorgold.com.au

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