SOURCE: KAL Energy, Inc.

March 01, 2007 09:10 ET

KAL Energy, Inc. Commences $2,000,000 USD Work Program

LONDON -- (MARKET WIRE) -- March 1, 2007 -- Kal Energy, Inc. (OTCBB: KALG) is pleased to announce that a $2,000,000 work program has been initiated on its Thermal Coal Project. The Project has been geologically estimated to contain an available resource of 192,000,000 tons coal and is situated near the Mahakam River in North Eastern Kalimantan, Indonesia. Previous testing has indicated that this coal has a low ash and sulphur content, which is preferable over some other coals due to its usability for environmentally friendly electricity generation.

The Phase 1 Drill Program includes extensive drilling, trenching, sampling and mapping of known geological structures, and exploration of unknown structures.

The two key objectives of this program are:

1) To further define the known seams to * JORC Compliant inferred resource status, and

2) Explore other prospective areas of our concessions for additional resources

"We look forward to beginning Phase 1 and outlining the significant levels of coal resources that have been estimated in our concessions. Our exploration of other unknown structures may yield findings of additional resources that we could utilize as well. This is an important step as we look forward to mining and shipping coal to customers later this year", stated Cameron Reynolds, Kal Energy's CEO.

In addition, Kal Energy has begun a general infrastructure upgrade on the block to enhance access and support the exploration program. This includes access road upgrades, and the construction of a camp to support the work force.

"We are extremely pleased with the rapid progress we are making with the buildup of our infrastructure to provide easier transportation to and from our concessions as well as enhancing the working conditions for our growing workforce," added Reynolds.

KAL Energy's wholly owned subsidiary Thatcher Mining Pte. has the rights to two coal concessions situated near the Mahakam River in North Eastern Kalimantan, Indonesia. This river is a main transportation system for transporting coal to nearby markets. Consulting Geologist, Jonathan O'Dell, has estimated that blocks 16 & 24 could contain over 192,000,000 tons of thermal coal. Today Indonesia is the leading exporter of thermal coal and export prices vary from $30.00 to $60.00 plus per ton. For more information on KAL Energy, Inc. please visit our web site at www.kalenergyinc.com

Cameron Reynolds,

Chief Executive Officer

KAL ENERGY INC.

*JORC Compliance is a standard used to establish proven reserves

Contact Information

  • Contact:
    KAL Energy, Inc. ("KALG")
    93-95 Gloucester Place
    London
    W1U 6JQ
    Telephone: 0207 487 8426
    Fax: 0207 487 8402