Kroes Energy unphased by Ukrainian political situation

CALGARY, Sept. 9 /CNW/ - Kroes Energy Inc. (TSX Venture: KRS) announced
today that recent political developments in Ukraine have had no impact on the
operation of its 45%-owned joint venture Kashtan Petroleum Ltd. In fact, the
Company does not anticipate future difficulties given Ukraine's need for
indigenous crude supplies.
Fred Callaway, President of Kroes Energy, said that "the situation within
the higher echelons of government has caused uncertainty in the market place.
But it has not and is unlikely to reach down to the operation of the joint
venture on the Lelyaki oil field. Ukraine supplies only 25% of its own crude
oil needs and confusion with respect to its domestic production would be
counterproductive."
The events of September 8 involved Ukrainian President Yushchenko's
dismissal of his cabinet amid rumors of corruption and political disagreements
among members of the cabinet. A new Prime Minister already has been appointed
and he will proceed immediately to select a new cabinet.
Mr. Callaway noted that "in the recent general election that culminated
in President Yushchenko's rise to power, the Ukrainian people demonstrated
their desire for democratic reform, western-style governance and a market-
based economy. I believe that the current situation reflects the growing pains
associated with such a major transition. It appears that the mood in Ukraine
is of general approval of the President's actions."
On the operations front at Kashtan Petroleum, testing of development well
No. 301 is now underway and it is producing oil. The stabilized results should
be available in a couple of weeks. The workover program continues with the
imminent reactivation of well No. 30 and preparations to begin work on well
No. 67.

Kroes Energy is a junior oil and gas producer and explorer participating
in the Lelyaki Oilfield redevelopment project in Ukraine, one of Eastern
Europe's fastest growing economies. Kroes has a strong management team, with
extensive international experience. Shares trade on the TSX Venture Exchange
under the symbol KRS.

Forward-Looking Statements
This disclosure contains certain forward-looking estimates that involve
substantial known and unknown risks and uncertainties, certain of which are
beyond Kroes' control, including: the impact of general economic conditions in
the areas in which the Company operates, industry conditions, changes in laws
and regulations including the adoption of new environmental laws and
regulations and changes in how they are interpreted and enforced, increased
competition, the lack of availability of qualified personnel or management,
fluctuations in commodity prices, foreign exchange or interest rates, stock
market volatility and obtaining required approvals of regulatory authorities.
In addition, there are risks and uncertainties associated with oil and gas
operations; therefore, Kroes' actual results, performance or achievement could
differ materially from those expressed in, or implied by, these forward-
looking estimates and, accordingly, no assurances can be given that any of the
events anticipated by the forward-looking estimates will transpire or occur,
or if any of them do so, what benefits, including the amounts of proceeds,
that Kroes will derive from that.

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