KAL Energy, Inc. — Exploration Program Surpasses 3000m of Drilling Milestone, Hits Weekly Productivity Record

KAL Energy, Inc is pleased to announce that over 3000m of drilling has been completed of its previously announced $2 million Phase 1 Exploration program on its Thermal Coal Project in East Kalimantan, Indonesia. This program includes extensive drilling, trenching, sampling and mapping of known geological structures, and exploration for unknown structures.

Over the past week KAL’s exploration team has been able to drill over 450m — a new weekly high — pushing the total meters drilled to date past 3000m. “KAL is now well and truly harnessing the productivity gains from its investments in site infrastructure and personnel. This accelerating rate of productivity gives the KAL management team firm confidence we will complete the Phase 1 Exploration program within the first half of 2007,” stated Cameron Reynolds, KAL Energy’s CEO.

The drill program currently taking place on KAL Energy’s concession in Indonesia is being conducted to determine the amount and quality of coal available. Geological estimates have indicated that in excess of 192 million tons of coal with low sulfur and ash content are located at shallow depths on the concessions.

KAL Energy’s wholly owned subsidiary Thatcher Mining Pte. Ltd. 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. With one of the world’s largest thermal coal exporters Kaltim Prima Coal (KPC) expected to produce 45 million tons of coal this year, as its neighbor, KAL energy’s concessions are in a region that is known for its extensive open pit thermal coal producing mines. Indonesia has recently surpassed Australia as the world’s leading thermal coal exporter, with 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

Notice Regarding Forward-Looking Statements

This news release contains “forward-looking statements,” as that term is defined in Section 27A of the United States Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements in this press release which are not purely historical are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future.

Cameron Reynolds CEO KAL Energy, Inc. 93-95 Gloucester Place London, W1U 6JQ Telephone: +44 207 487 8426 Fax: +44 207 487 8402

US Investor Relations Line: +1-866-680-2575