KGL RESOURCES LIMITED — Interim / Quarterly Report 2005

Jul 24, 2005

KENTOR GOLD LTD

ACN 082 658 080 Registered Office: Level 3, 15 Queen Street Melbourne Victoria 3000 www.kentorgold.com.au

Australia Suite 405 Level 4 9 Sherwood Road Toowong Queensland 4066 +61 (7) 3217 8708 Phone: $+61(7)32178698$ Fax: $\mbox{E-mail}\colon$ droyle@kentorgold.com.au Kyrgyz Republic

235/2 Erkindik Prospect 720739 Bishkek ---------------------------------------Phone: -996 (312) 665 759 $F_{\rm NN}$ $k$ entor $2\omega$ mail. $k$ g E-mail:

25 July 2005

JUNE QUARTER 2005 ACTIVITIES REPORT

EXPLORATION PROGRAMME

Summary

Kentor is now two months into the first summer exploration program as a public company, with three exploration teams totalling approximately 30 people in the field. Geophysical work has commenced at Ertash in anticipation of the drill start up in early August. First pass evaluation of the Talas tenements has been completed, with some initial positive indicators of porphyry Cu-Au mineralisation at Uzunbulak.

Ertash:

A survey party has laid out access road works and earthmoving equipment has mobilised to commence construction and a field camp has been established at Akbel to support this work. An IP/resistivity survey by Search Exploration and a ground magnetic survey are underway at Akbel to provide enhanced targeting information for the drilling to start in early August as scheduled. The figure below summarises the work program over the Akbel area

Uzunbulak:

Ground magnetics, gridding and detailed geological and alteration mapping has been completed. Preliminary interpretation of magnetic data indicates $\mathbf{a}$ well defined contact zone between sediment and the intrusive complex to the east that warrants further assessment.

A total of 351 soil samples, 28 stream sediment and 196 rock chip and rock channel sawn samples were dispatched to ALS Chemex, Perth for multielement analysis. The first rock assays (total 73) to hand have returned comparable results to the previous reconnaissance sampling, reported in an ASX release on 19 April 2005. The figure to the right shows the results of the magnetic survey together with all sample locations. An evaluation of all the results will be carried out as soon as assays are completed.

Barkol:

The Kugandy prospect at Barkol consists of a window of fractured meta-sediments and feldspar porphyry dykes exposed through a younger bedded volcanic package. Mineralisation is structurally controlled consisting of disseminated chalcopyrite and pyrite in brecciated zones, often along the porphyry dyke margins and could represent the upper levels of a porphyry Cu-Au system. Taldybulak, a Talas region porphyry deposit, lies only 5 km to the south east.

Initial reconnaissance phase exploration including sampling and mapping of targets is now complete and results from 259 rock chip/channel and 58 stream sediment samples submitted for assay are awaited. Planning for any further work required will be undertaken when all rock and stream results have been analysed and evaluated

Bakaitash:

Follow up reconnaissance sampling of six targets has been completed. Further work will be planned when results of rock and stream results have been analysed and evaluated.

Karabalta:

Reconnaissance stream sampling of the main "intrusion-related" targets in the eastern half of the tenement has been completed with about 120 samples submitted for analysis. Preliminary geological assessment of the targets is being carried out over an area characterised by rugged and steep topography.

Generative:

Capture of geophysical and geological data for the Central & Southern Tien Shan region is progressing. A ground target follow-up phase of work will be conducted later in summer

Tenements:

The map below shows current tenements in the Kyrgyz republic. No new tenements were applied for this quarter.

Project Tenements

Based on Kentor's desire to focus on large mineralised systems and not pursue narrow gold-bearing veins, a decision was made to relinquish interest in the Karasu PL. This prospect contained evidence of minor quartz veins and some weak gold geochemistry but was not considered a priority project.

Drilling:

The drill rig is scheduled to arrive in Bishkek on about 25 July, followed by customs clearance of one week.

GOVERNMENT AFFAIRS

The 10 July Presidential election in the Kyrgyz Republic resulted in an overwhelming win for President Kurmanbek Bakiev. The Organization for Security and Cooperation in Europe commented that the election has helped stabilise the country and that the "political legitimacy" of the leadership was now much stronger. Kentor continues to have good relationships with all levels of government and sees this new era in the country's development as supportive for Kentor's long term growth.

David Royle, F.AusIMM, CP Managing Director Kentor Gold Ltd

For further information contact: John Rawling Company Secretary Ph: +61 3 9621 1344 info@kentorgold.com

Information in this report that relates to a statement of exploration results of the Company is based on information compiled by David Z Royle, BSc (Hons) (Geology). Mr Royle is Managing Director of Kentor Gold Ltd and has sufficient experience relevant to the style of mineralisation and type of deposits under consideration and to the activity undertaken. He is qualified as a competent person as defined in the 2004 Edition of the "Australasian Code for Reporting of Mineral Resources and Ore Reserves" (or "JORC Code").