October 4, 2004

NEWS RELEASE

Activity update provided by George Stewart

Arcadia Property: (Skylark Mine) Greenwood Area – gold prospect

The Company plans geophysics to find gold zones. Close to the time the Skylark Mine was shutting down, drilling encountered gold occurring in a major fault called the Serp Zone. The fault-hosted mineralization has greater tonnage potential than the narrow silver vein mined in 1988. Selected results from published information regarding the fault, report Hole RC86-18 encountering 30 feet of 0.367 opt gold. Underground percussion holes within the fault, encountered in two separate holes 4 feet of 3.3 opt and 4 feet of 2.4 opt gold (Skylark Resources Ltd. News release June 9, 1989.) The shallow dipping fault structure is 30 to 100 feet wide and hosts serpentine, quartz veins, silicified mylonite and pyrite.

The Serp Zone is a fault-hosted zone of gold mineralization straddling our property boundary and the adjoining Snowshoe Property. It was previously tested by 25 surface diamond drill holes and 18 surface reverse circulation holes with varying results. Drilling and underground work at the Serp Zone have located free gold occurring in irregular quartz veins in serpentinite. A decline, completed in 1987, provided underground access to the zone and 21 underground percussion (test steel) drill holes were completed. Previous exploration was confined to the mine area leaving large areas unexplored. Gold is often found to be associated with pyrite and the upcoming geophysical program will be designed to locate pyrite zones within the fault. The large Phoenix property lies between the Arcadia Project and the active exploration of Gold City Industries; both projects are exploring and developing structural controlled gold deposits.

Diamonds

WO Claim Block- Northwest Territories

Peregrine Diamonds Inc. (Peregrine) has advised they will acquire a bulk sample from the Tli Kwi Cho (DO27) kimberlite to proceed once permitting is received. On September 20, 2004, an amended WO JV Agreement covering Mining Leases SAS1, SAS2 and SAS3 was signed appointing Peregrine the operator, giving them an option to increase their interest to 54.475% from the current 38.475% by paying the entire cost of a 200 tonne bulk sample. The DHK Diamonds Inc. (DHK) participating interest, upon completion of the bulk sample will be reduced from the current 28.8% to 20%. Kettle River owns an equal 1/3 interest in DHK. Peregrine has purchased the former BHP Billiton interest in the WO Claim Block.

The Tli Kwi Cho pipe was tested in 1994 by Kennecott Canada via an underground tunnel. The central and deeper portion of the pyroclastic phase of the kimberlite containing the better diamond grades as indicated by drilling was never tested. The 1994 sampling tunnel was abandoned due to caving. A portion of the sample contained indications of the presence of larger stones, although insufficient diamonds were obtained to accurately reflect the pipe potential.

Pellatt Lake Property

Peregrine Diamonds Inc. reported they expect to complete the airborne survey this fall. Peregrine must complete the Falcon Survey by December 31, 2004 or forfeit the $16,270 advanced for the work bond on three of the claims. Prior to Dec. 31, 2005, Peregrine has the right to drill test, at its cost, any targets identified by the Falcon Survey to acquire 51% of each target drill tested. After completing a 200 tonne bulk sample, they earn 65% of that target and a further 10% can be earned by arranging production cost financing for the DHK partner.

Kettle River is an equal 1/3 partner in DHK Diamonds Inc. (‘DHK’). On the Pellatt Lake property, transferred by Kennecott Canada Exploration Inc. (‘KCEI’) 100% subject to a 1% NSR; DHK entered into an option agreement where Peregrine Diamonds may earn an interest in the property by flying a falcon gradiometer survey over the claims. The claims contain a diamondiferous dike and are located to the north of the Hardy Lake kimberlite field.

Administration Matters

The Company reports that statements and allegations made by Dentonia Resources Ltd. (refer to 9 month interim financial statement July 27, 2004 available on www.sedar.com) relating to DHK Diamonds Inc. shareholder advances and that they are owed $60,000 by Kettle River are unfounded and the Shareholders’ Advances are erroneously stated. The financial statements quoted have not received director and shareholder approval. Kettle River has contributed equally to every DHK budget presented as governed by the Shareholder Agreement between Dentonia Resources Ltd., Horseshoe Gold Mining Inc. and Kettle River Resources Ltd. Further details pertaining to this dispute can be obtained from the Company.

In other matters, on July 12, 2004, the Company filed on Sedar a ‘Change of Auditor Reporting Package.’ At the request of the Company, Grant Thornton LLP resigned and Staley Okada & Partners, Chartered Accountants has replaced them as the auditors for the Company. Shareholders will be asked to approve the appointment at the Annual and Special Meeting of the Shareholders on October 22, 2004.

On Behalf of the Board,

“George Stewart”

George O.M. Stewart

President

The TSX Venture Exchange has not reviewed and does not accept responsibility for adequacy or accuracy of this release.