KGL RESOURCES LIMITED — Interim / Quarterly Report 2005

Mar 15, 2005

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KENTOR GOLD LTD
(Formerly Kentor Gold N.L.)

A.B.N. 52 082 658 080

AND CONTROLLED ENTITY

PRO FORMA STATEMENT OF FINANCIAL POSITION
FOR THE HALF-YEAR ENDED
31 DECEMBER 2004

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DIRECTORS' DECLARATION

The directors of the company declare that:

• the financial statements and notes are in accordance with the Corporations Act 2001: $\mathbf{1}$
• comply with Accounting Standard AASB 1029: Interim Financial Reporting and $(a)$ the Corporations Regulations; and
• give a true and fair view of the financial position as at 31 December 2004 and of $(b)$ the performance for the half-year ended on that date.
• In the directors' opinion, there are reasonable grounds to believe that the Company will $2.$ be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Directors,

Dated this $/ \theta$ ^k

day of March 2005

JOHN BARR DIBECTOR

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KENTOR GOLD LTD (Formerly Kentor Gold N.L.)
A.B.N. 52 082 658 080 AND CONTROLLED ENTITY

STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2004

	Economic Entity		Pro Forma
	Note	\$	\$
CURRENT ASSETS Cash assets Receivables	3 4	662,254 119,795	6,180,871 119,795
TOTAL CURRENT ASSETS		782,049	6,300,666
NON-CURRENT ASSETS Other financial assets Property, plant and equipment Intangible assets	5 6 7	955,143 84,862 4,040	955,143 84,862 4,040
TOTAL NON-CURRENT ASSETS		1.044.045	1,044,045
TOTAL ASSETS		1,826,094	7,344,711
CURRENT LIABILITIES Payables	8	57.781	57,781
TOTAL CURRENT LIABILITIES		57,781	57,781
TOTAL LIABILITIES		57,781	57,781
NET ASSETS		1,768,313	7,286,930
EQUITY Contributed equity Accumulated losses Outside Equity Interest	9 2 10	3,513,581 (1,676,040) (69, 228)	9,032,198 (1,676,040) (69, 228)
TOTAL EQUITY		1,768,313	7,286,930

The accompanying notes form part of these financial statements.

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KENTOR GOLD LTD (Formerly Kentor Gold N.L.) A.B.N. 52 082 658 080 AND CONTROLLED ENTITY

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2004

Basis of Preparation of the Pro Forma Economic Entity Statement of Financial 1 Position

The Pro Forma Statements of Financial Position assume the following transactions:

• The allotment of 12,000,000 ordinary shares to the public at 50 cents each $\bullet$ (\$6,000,000) as outlined in the 2005 Prospectus.
• The incurring of \$481,383 of equity raising costs prior to the issue of the $\bullet$ shares issued under the 2005 Prospectus.

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KENTOR GOLD LTD (Formerly Kentor Gold N.L.) A.B.N. 52 082 558 080 AND CONTROLLED ENTITY

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2004

		Economic Entity	Pro Forma
		s	\$
2	Accumulated Losses
	Accumulated losses at the beginning of the
	financial year Net loss attributable to members	(1,398,090)	(1,398,090)
	of the company	(279,905)	(279, 905)
	Net (Profit) / loss attributable to Outside Equity Interest	1,955	1,955
	Accumulated losses at the end of the
	half-year	(1,676,040)	(1,676,040)
з	Cash Assets
	Cash on Hand	1	1
	Cash at Bank	662,253	662,253
	Expected Cash from Capital Raising per Float		5,518,617
		662,254	6,180,871
4	Receivables CURRENT
	Other Receivable	63,780	63,780
	GST Refund	53.609	53,609
	Bond - Brisbane Office	1,524	1,524
	TFN Withholding Tax	882	882
		119,795	119,795
5	Other Financial Assets
	NON CURRENT
	Exploration Expenditure
	Costs carried forward in respect of areas of interest
	in exploration and evaluation phases	937,562	937,562
	USD Loan Receivable from foreign controlled entity
	AUD Loan Receivable from foreign controlled entity		3,330
	Other Investments (at cost) Investment in foreign controlled entity (at cost)	3.330
	Investment in Action Hydrocarbons Limited (at cost)	14,251	14,251
		955,143	955.143

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KENTOR GOLD LTD (Formerly Kentor Gold N.L.) AB.N. 52 082 658 080
AND CONTROLLED ENTITY

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NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2004

	Economic Entity	Pro Forma
	Ż.	\$
Property, Plant and Equipment		127,357
Plant & Equipment (at cost)	127 357
Less: Accumulated Depreciation	56,371	56,371
	70.986	70,986
	16,608	16,608
Computer Equipment & Software (at cost) Less: Accumulated Depreciation	3,825	3,825
	12.733	12,783
Low Value Pool Items (at cost)	1.659	1,659
Less: Accumulated Depreciation	566	566
	1,093	1.093
Total Plant and Equipment	34,862	84.862

Movement in the carrying amounts for each class of property, plant and
equipment between the beginning and the end of the current financial year

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KENTOR GOLD LTD (Formerly Kentor Gold N.L.)
A.B.N. 52 082 658 080 AND CONTROLLED ENTITY

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2004

		Economic Entity	Pro Forma
		s.	\$
7	Intangibles Assets
	Preliminary Expenses (at cost) Geological Information & Licenses	1,570 2,470	1,570 2,470
		4,040	4,040
8	Payables CURRENT Trade Creditors	24,614	24,614
Sundry Creditors Provision for Income Tax	33,167	33,167
		57,781	57,781

KENTOR GOLD LTD (Formerly Kentor Gold N.L.) A.B.N. 52 082 658 080 AND CONTROLLED ENTITY

NOTES TO THE FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2004

		Economic Entity	Pro Forma s.
		Ş
ġ,	Contributed Equity
	Paid Up Capital:
	34,151,132 Fully Paid Ordinary Shares	3,513,581	9,032,198
	At the beginning of the reporting period	2,640,629	2,640,629
	Shares issued during the period (as listed below)	991,031	6,991,031
Transaction costs relating to share issues		(118,079)	(599, 462)
	3,513,581	9.032.198

During the year the following capital transactions occurred:

(A) 12 August 2004 - 1,239,698 ordinary shares were issued at 33 cents per share

(B) 23 September 2004 - 1,308,881 ordinary shares were issued at 33 cents per share

(C) 4 October 2004 - 454,546 ordinary shares were issued at 33 cents per share

(D) A General Meeting of members was held on 25 October 2004. A special resolution was passed at this meeting to consolidate the share capital on the basis of every 3 shares be converted to 1 share.

(E) 12,000,000 ordinary shares at 50 cents per share are expected to be Issued by way of floating and listing the company on the Australian Stock Exchange.

10 Outside Equity Interest

Outside Equity Interest comprises
Share Capital	6.784	6.784
Reserves	-
Retained Profits/(Losses)	(76, 012)	(76,012)
	(69.228)	(69, 228)

LEVEL 2, 50 BURWOOD ROAD, HAWTHORN

P.O. Box 325, Hawthorn, Victoria 3122, Australia Tel +613 9819 4011 Fax +613 9819 5780 Web www.raggweir.com.au Email raggweir@raggweir.com.au

INDEPENDENT REVIEW REPORT TO THE MEMBERS OF KENTOR GOLD LTD (formerly Kentor Gold N.L.)

Scope

We have reviewed the pro-forma consolidated financial report of Kentor Gold Ltd for the half-year ended 31 December 2004. The company's directors are responsible for the pro-forma consolidated financial report comprising the company and the entities it controlled at the end of the half-year or from time to time during the half-year. The pro-forma consolidated financial report comprises the Statement of Financial Position and accompanying notes for the half-year ended 31 December 2004. We have performed an independent review of the pro-forma consolidated financial report in order to state whether, on the basis of the procedures described, anything has come to our attention that would indicate that the pro-forma consolidated financial report is not presented fairly in accordance with Accounting Standard AASB 1029: Interim Financial Reporting and other mandatory professional reporting requirements in Australia and statutory requirements, so as to present a view which is consistent with our understanding of what the economic entity's financial position will be after the capital raising per float of \$6,000,000, in order for the company to lodge the pro-forma consolidated financial report with the Australian Stock Exchange Limited.

Our review has been conducted in accordance with Australian Auditing Standards applicable to review engagements. A review is limited primarily to inquiries of company personnel and analytical procedures applied to the financial data. These procedures do not provide all the evidence that would be required in an audit, thus the level of assurance provided is less than given in an audit. We have not performed an audit and, accordingly, we do not express an audit opinion.

Statement

Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half-year pro-forma consolidated financial report of Kentor Gold Ltd is not in accordance with:

a. the Corporations Act 2001, including:

• i. giving a true and fair view of the financial position of the economic entity as at 31 December 2004; and
• ii. Complying with Accounting Standards AASB 1029: Interim Financial Reporting and the Corporation Regulations 2001; and
• b. other mandatory professional reporting requirements in Australia.

MSI Ragg Wei

MSI RAGG WEIR CHARTERED ACCOUNTANTS

In. D. Liberal

G.D. WOOD PARTNER

Melbourne: 10 March 2005