Kestrel Energy Inc – ‘424B3’ on 10/1/03

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Prospectus   —   Rule 424(b)(3)
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Document/Exhibit                   Description                      Pages   Size 

 1: 424B3       Prospectus [9-29-03]                                  12     50K 

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                                    Registration Statement No. 333-99151
                                                    424(b)(3) Prospectus

PROSPECTUS                                                                      

KESTREL ENERGY, INC.

1,409,000 SHARES
COMMON STOCK
--------------------  

     This prospectus relates to 1,409,000 currently outstanding shares of common
stock that may be sold from time to time by the selling shareholders named in   
this prospectus.                                                                

  The offering is not being underwritten. The offering price of our common
stock that may be sold by selling shareholders may be the market price for our  
common stock prevailing at the time of sale, a price related to the prevailing  
market price, a negotiated price or such other prices as the selling            
shareholders determine from time to time.                                       

    We will not receive the proceeds from the sales of our common stock by the
selling shareholders.                                                           

Our common stock is traded on the OTC Bulletin Board under the symbol 
"KEST." On September 29, 2003, the last reported sale price of our common stock 
was $0.319 per share.                                                           

 INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. YOU
 SHOULD CAREFULLY CONSIDER THE RISK FACTORS BEGINNING ON PAGE 3.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES         
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A     
CRIMINAL OFFENSE.                                                               

KESTREL ENERGY, INC.
1726 Cole Boulevard, Suite 210
Lakewood, Colorado 80401
(303) 295-0344

The date of this Prospectus is September 29, 2003.

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[INSIDE FRONT COVER]
 TABLE OF CONTENTS

Risk Factors.................................................................3  
Forward-Looking Statements...................................................6  
Where You Can Find More Information..........................................7  
Our Business.................................................................8  
Recent Developments..........................................................8  
New Developments.............................................................9  
Use of Proceeds.............................................................10  
Selling Shareholders........................................................10  
Plan of Distribution........................................................11  
Experts.....................................................................12  
Legal Matters...............................................................12  

  You should rely only on the information contained in this prospectus. We
have not authorized anyone to provide you with information different from that  
contained in this prospectus. The selling shareholders are offering to sell, and
seeking offers to buy, shares of common stock only in jurisdictions where offers
and sales are permitted. The information contained in this prospectus is        
accurate only as of the date of this prospectus, regardless of the time of      
delivery of this prospectus or of any sale of common stock.                     

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RISK FACTORS

WE MUST CONTINUE TO EXPAND OUR OPERATIONS                                       

    Our long term success is ultimately dependent on our ability to expand our
revenue base through the acquisition of producing properties and, to a much     
greater extent, by successful results in our exploration efforts. There is no   
assurance that our acquisitions will be as successful as projected. All of our  
exploration projects are subject to failure and the loss of our investment.     

PRICES OF OIL AND NATURAL GAS FLUCTUATE WIDELY BASED ON MARKET CONDITIONS AND   
ANY DECLINE WILL ADVERSELY AFFECT OUR FINANCIAL CONDITION                       

  Our revenues, operating results, cash flow and future rate of growth are
very dependent upon prevailing prices for oil and gas. For the fiscal year ended
June 30, 2002, approximately $1,149,500 of our revenue was attributed to the    
sale of oil and gas. Historically, oil and gas prices and markets have been     
volatile and not predictable, and they are likely to continue to be volatile in 
the future. Prices for oil and gas are subject to wide fluctuations in response 
to relatively minor changes in the supply of and demand for oil and gas, market 
uncertainty and a variety of additional factors that are beyond our control,    
including:                                                                      

o    the strength of the United States and the global economy;        

o    political conditions in the Middle East and elsewhere;           

o    the supply and price of foreign oil and gas;                     

o    the level of consumer product demand;                            

o    the price and availability of alternative fuels;                 

o    the effect of federal and state regulation of production and     
transportation; and                                         

o    the proximity of our natural gas to pipelines and their capacity.

WE MUST REPLACE THE RESERVES WE PRODUCE                                         

    A substantial portion of our oil and gas properties are proved undeveloped
reserves. Successful development and production of such reserves cannot be      
assured. Additional drilling will be necessary in future years both to maintain 
production levels and to define the extent and recoverability of existing       
reserves. There can be no assurance that our present oil and gas wells will     
continue to produce at current or anticipated rates of production, that         
development drilling will be successful, that production of oil and gas will    
commence when expected, that there will be favorable markets for oil and gas    
which may be produced in the future or that production rates achieved in early  
periods can be maintained.                                                      

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THERE ARE MANY RISKS IN DRILLING OIL AND GAS WELLS                              

  The cost of drilling, completing and operating wells is often uncertain.
Moreover, drilling may be curtailed, delayed or canceled as a result of many    
factors, including title problems, weather conditions, shortages of or delays in
delivery of equipment, as well as the financial instability of well operators,  
major working interest owners and well servicing companies. Our gas wells may be
shut-in for lack of a market until a gas pipeline or gathering system with      
available capacity is extended into our area. Our oil wells may have production 
curtailed until production facilities and delivery arrangements are acquired or 
developed for them.                                                             

WE FACE INTENSE COMPETITION                                                     

 The oil and natural gas industry is highly competitive. We compete with
others for property acquisitions and for opportunities to explore or to develop 
and produce oil and natural gas. We have previously formed acquisition joint    
ventures with several other companies, including Victoria Petroleum N.L. and    
other affiliates, which have allowed us more access to acquisition candidates   
and to share the evaluation costs with them. We face strong competition from    
many companies and individuals with greater capital, financial resources and    
larger technical staffs. We also face strong competition in procuring services  
from a limited pool of laborers, drilling service contractors and equipment     
vendors.                                                                        

THE AMOUNT OF INSURANCE WE CARRY MAY NOT BE SUFFICIENT TO PROTECT US            

The nature of the oil and gas business involves a variety of risks,   
including, but not limited to, the risks of operating hazards such as fires,    
explosions, cratering, blow-outs, adverse weather conditions, pollution and     
environmental risks, encountering formations with abnormal pressures, and, in   
horizontal wellbores, the increased risk of mechanical failure and collapsed    
holes, the occurrence of any of which could result in substantial losses to us. 
We, our partners, co-venturers and well operators maintain general liability    
insurance again some, but not all, of these risks in amounts that management    
believes to reasonable in accordance with customary oil and gas industry        
practices. The occurrence of a significant event that is not fully insured,     
however, could have a material adverse effect on our financial condition and    
results of operations.                                                          

OUR SUCCESS MAY BE DEPENDENT ON OUR ABILITY TO RETAIN BARRY LASKER AND BOB      
PETT AS KEY PERSONNEL                                                           

 We believe that the oil and gas exploration and development and related
management experience of our key personnel is important to our success. The     
active participation in Kestrel of Barry D. Lasker, our president, and Robert J.
Pett, our chairman, are important to our continued operations. We have an       
employment contract with Mr. Lasker which currently expires August 14, 2004, and
renews automatically each May 14 for an additional year if neither party gives  
timely notice of intent to terminate. We do not have key person life insurance  
on either Mr. Lasker's or Mr. Pett's lives. We compete with bigger and better   
financed oil and gas exploration companies for these individuals and other      
qualified personnel. Our future success                                         

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may depend on whether we can attract, retain and motivate highly qualified      
personnel. We cannot assure you that we will be able to do so.                  

OUR RESERVES ARE UNCERTAIN                                                      

Estimating our proved reserves involves many uncertainties, including 
factors beyond our control. Our annual report on Form 10-KSB for fiscal year    
2002 contained estimates of our oil and natural gas reserves and the future cash
flow to be realized from those reserves for fiscal years 2002, 2001 and 2000, as
prepared by Sproule Associates Inc., independent petroleum engineers. There are 
uncertainties inherent in estimating quantities of proved oil and natural gas   
reserves since petroleum engineering is not an exact science. Estimates of      
commercially recoverable oil and gas reserves and of the future net cash flows  
from them are based upon a number of variable factors and assumptions including:

 o    historical production from the properties compared with production
from other producing properties;                            

o    the effects of regulation by governmental agencies;              

o    future oil and gas prices; and                                   

     o    future operating costs, severance and excise taxes, abandonment costs,
development costs and workover and remedial costs.          

GOVERNMENTAL REGULATION, ENVIRONMENTAL RISKS AND TAXES COULD ADVERSELY AFFECT   
OUR OIL AND GAS OPERATIONS IN THE UNITED STATES                                 

Our oil and natural gas operations in the United States are subject to
regulation by federal and state government, including environmental laws. To    
date, we have not had to expend significant resources in order to satisfy       
environmental laws and regulations presently in effect. However, compliance     
costs under any new laws and regulations that might be enacted could adversely  
affect our business and increase the costs of planning, designing, drilling,    
installing, operating and abandoning our oil and gas wells and other facilities.
Additional matters that are, or have been from time to time, subject to         
governmental regulation include land tenure, royalties, production rates,       
spacing, completion procedures, water injections, utilization, the maximum price
at which products could be sold, energy taxes and the discharge of materials    
into the environment.                                                           

THE MARKET FOR OUR STOCK MAY BE HIGHLY VOLATILE                                 

Our stock is currently traded on the OTC Bulletin Board, but there has
historically been a relatively low volume of trading in the shares.             
Consequently, the price at which the shares trade may be highly volatile. We    
were listed on The Nasdaq SmallCap Market, Inc., but after continued failure to 
meet all of the requirements for continued listing on the SmallCap Market       
because our stock traded below the minimum $1.00 per share requirement, we were 
delisted by the SmallCap Market on April 8, 2003. Our stock will be listed on   
the OTC Bulletin Board as long as we continue to file our reports with the SEC. 
The change to the OCT Bulletin Board                                            

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may have reduced the liquidity of our stock which, in turn, may adversely affect
the trading price for the stock.                                                

THE SALE OF THE SHARES BY THE SELLING SHAREHOLDERS COULD HAVE AN ADVERSE        
IMPACT ON OUR STOCK                                                             

  The selling shareholders are not restricted as to the price or prices at
which they may sell their shares. Sales of their shares at less than the market 
prices may depress the market price of our stock. Moreover, the selling         
shareholders are not restricted as to the number of shares which may be sold at 
any one time, and it is possible that a significant number of shares could be   
sold at the same time which may depress the market price of our stock. The      
outstanding shares being offered by the selling shareholders represent          
approximately 15.4% of our current outstanding shares.                          

FORWARD LOOKING STATEMENTS

   This prospectus contains one or more statements, which state or otherwise
indicate the Company's present belief or expectation concerning future events.  
Such statements are forward looking statements on which investors should not    
rely because they are subject to a wide variety of contingencies and based on a 
number of assumptions, which may not prove to be true. In particular, the       
Company's future success is highly dependent on the success of its exploratory  
drilling efforts, which cannot be safely predicted. In addition, the Company is 
highly dependent upon prevailing prices for petroleum products, its ability to  
attract and retain qualified personnel, as well as other risk factors affecting 
business generally, such as overall economic conditions, changes in tax and     
other laws and the effect of actions taken by competitors and regulatory        
authorities. You should also remember that these statements are made only as of 
the date of this prospectus and future events may cause them to be less likely  
to prove to be true.                                                            

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   WHERE YOU CAN FIND MORE INFORMATION

 We file annual, quarterly, special reports, proxy statements, and other
information with the Securities and Exchange Commission. You can read and copy  
any document filed by us at the SEC's Public Reference Room, 450 Fifth Street   
N.W., Washington, D.C. 20549. You may request copies of these documents, upon   
payment of a duplicating fee, by writing the SEC at the address in the previous 
sentence. Please call the SEC at 1-800-SEC-0330 for further information on the  
operation of its Public Reference Room. Our SEC filings are also available on   
the SEC's Edgar website at http://www.sec.gov.                                  

The SEC allows us to "incorporate by reference" information from other
documents that we file with it, which means that we can disclose important      
information by referring you to those documents. The information incorporated by
reference is an important part of this prospectus, and information that we file 
later with the SEC will automatically update and supersede this information. We 
incorporate by reference the following documents:                               

 o    our Annual Report on Form 10-KSB for the year ended June 30, 2002;

    o    our Quarterly Reports on Form 10-QSB for the quarters ended September
30, 2002, December 31, 2002 and March 31, 2003;             

o    the description of our securities contained in our registration  
         statement on Form 8-A, File No. 0-9261, filed on May 2, 1980 pursuant
   to Section 12(g) of the Securities Exchange Act of 1934, and as
         amended by our Form S-3, File No. 33-89716, declared effective on May
12, 1995;                                                   

o    all Forms 8-K filed since July 1, 2002; and                      

     o    all documents and reports subsequently filed with the Commission by us
     pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act
          after the date of this prospectus and prior to the termination of this
offering of common stock.                                   

  You may request a copy of any of these documents, except exhibits to the
documents, unless they are specifically incorporated by reference, at no cost by
telephoning us (303) 295-0344 or writing us at the following address: Melissa   
Temple, Kestrel Energy, Inc., 1726 Cole Boulevard, Suite 210, Lakewood, Colorado
80401.                                                                          

    You should rely only on the information contained in this document or that
we have referred you to. We have not authorized anyone else to provide you with 
different information.                                                          

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    OUR BUSINESS

 Our principal business at this time is the acquisition, either alone or
with others, of interests in proved developed producing oil and gas leases, and 
exploratory and developmental drilling in the United States. Additionally, we   
own working interests, which are expense bearing interests, in proved developed 
producing and proved undeveloped oil and gas leases that are not operated by us,
in several areas in the United States. Proved developed reserves are oil and gas
reserves which can be expected to be recovered through existing wells with      
existing equipment and operating methods. Proved undeveloped reserves are oil   
and gas reserves which can be expected to be recovered from new wells on        
undrilled acreage or from existing wells where a relatively major expenditure is
required for recompletion. Normally we use existing working capital and cash    
flow for the development of our exploration and development properties. However,
we have in the past obtained debt and equity financing to fund our development  
efforts and expect to do so again in the future.                                

We presently own oil and gas interests in the states of Louisiana, New
Mexico, Oklahoma, Texas and Wyoming.                                            

We were incorporated in Colorado on November 1, 1978 as Tanner Pruitt 
Exploration, Inc. In March 1995, we changed our name to Kestrel Energy, Inc. Our
offices are located at 1726 Cole Boulevard, Suite 210, Lakewood, Colorado 80401,
and our telephone number is (303) 295-0344.                                     

   RECENT DEVELOPMENTS

     As of June 30, 2002, the Company owed approximately $516,000 on its line of
credit with Wells Fargo Line of Credit, which line was secured by deeds of trust
on various of the Company's oil and gas producing properties. On August 6, 2002 
the Company borrowed $500,000 from Samson Exploration N.L. (a related party) and
used the proceeds of the loan to pay off the Wells Fargo loan. Interest under   
the Samson loan was 10% per annum in addition to an up front financing fee of   
10%.                                                                            

    On January 24, 2003, the Company borrowed $400,000 from R&M Oil and Gas,
Ltd., of which Timothy L. Hoops, one of the Company's directors and its         
Operations Manager, is a partner. That loan is due on January 31, 2005, bears   
interest at 12.5% per annum and is secured by the Company's oil and gas         
interests in Grady County, Oklahoma. In the event of a default under the terms  
of the R&M loan, and the sale of the collateral securing the loan, the Company  
would receive any remaining proceeds after payment to R&M of its expenses in    
connection with such sale(s) and any indebtedness due and payable to R&M under  
the loan. The proceeds from the R&M loan were used to retire the outstanding    
debt to Samson Exploration N.L. and reduce the Company's accounts payable       
position at the time. The R&M loan was approved unanimously by the Board of     
Directors with Mr. Hoops abstaining, which evaluated its fairness.              

  On February 4, 2003, the Company repaid Samson Exploration N.L. in full,
including all accrued interest and fees, with $327,143.15 in cash and the       
transfer of the Company's remaining 25,000,000 shares of Victoria Petroleum N.L.
common stock. On May 5, 2003, the Company                                       

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entered into a Line of Credit Agreement with Barry D. Lasker, President and CEO 
of Kestrel, and borrowed $200,000. Under the terms of the agreement all         
outstanding amounts are due on May 4, 2005 and bear interest at 10% per annum.  
The proceeds of the loan consisted of $50,000 cash and forgiveness of           
approximately $150,000 of unpaid wages and unreimbursed business expenses owed  
to Mr. Lasker by the Company. The Lasker loan is secured by the Company's oil   
and gas interests in Campbell County, Wyoming. In the event of a default under  
the terms of the Lasker loan, and the sale of the collateral securing the loan, 
the Company would receive any remaining proceeds after payment to Mr. Lasker of 
his expenses in connection with such sale(s) and the indebtedness due and       
payable to him under the loan. Like the R&M loan, the Lasker loan was approved  
as an arms length transaction by the entire Board of Directors with Mr. Lasker  
abstaining.                                                                     

NEW DEVELOPMENTS

Beginning in fiscal 2000, the Company began accumulating a substantial
amount of acreage in southwest Wyoming's Green River Basin (the "Greens Canyon  
Prospect"). The Company also drilled and completed two wells, the Greens Canyon 
#1 (UPRC #27-3) and Greens Canyon #2 (UPRC #29-2). While the drilling results of
both wells indicated that substantial amounts of gas were present and could be  
produced, the Company encountered a series of mechanical problems when it       
attempted to fracture the wells to stimulate production. As a result, initial   
production from the wells was only 500 to 700 mcf per day. Information gathered 
during the completion process made it clear that the mechanical problems, which 
were unrelated to any specific characteristics of the wells themselves, were the
sole cause of the lower production. The Company announced its intent to take    
necessary corrective actions to remedy the mechanical problems and re-establish 
commercial production levels. In consultation with its independent petroleum    
engineering consultants, Sproule Associates Inc., the Company classified a      
substantial amount of Greens Canyon reserves as proved undeveloped reserves in  
its June 30, 2000 petroleum reserves report because the Company believed that   
its geological and engineering data demonstrated with reasonable certainty that 
those known reserves were recoverable under existing economic and operating     
conditions.                                                                     

      During fiscal 2001, the Company began the process of re-working the Greens
Canyon wells. The Company re-completed three wells, resulting in improved       
production levels in the short run. By the end of fiscal 2001, however, daily   
production rates for the wells had declined to modest levels. In October of     
2001, new Company management declared that, while the Company was still         
convinced that significant gas reserves were present, the Company would bring in
additional participants into the Greens Canyon project in order to share the    
financial burden of further development. As a result, the Company reported a    
decrease in the total proved gas reserves to 13.4 Bcf and oil reserves to       
355,000 barrels.                                                                

   New management found the Company to be overburdened by debt and limited
cash flow in fiscal 2002, which was at least partially attributable to          
additional debt incurred to support development of the Greens Canyon project.   
Management's resulting focus on strengthening its balance sheet in fiscal 2003  
prevented it from focusing its full attention on the Greens Canyon farm out     
effort. During fiscal 2003, however, the Company vigorously pursued the Greens  
Canyon farm out effort, only to learn that, for various reasons, a suitable farm
out partner is not                                                              

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currently available. As a result, the Company has determined that, as of June   
30, 2003, it will remove all proved undeveloped and proved developed            
non-producing reserves formally attributed to the Greens Canyon project until   
further drilling activity demonstrates that commercial flow-rates can be        
achieved.                                                                       

 USE OF PROCEEDS

    We will not receive any proceeds from the sale of the common stock offered
by the selling shareholders pursuant to this prospectus.                        

SELLING SHAREHOLDERS

The shares offered pursuant to this prospectus have been issued to the
selling shareholders (or their assignees) directly by us. The selling           
shareholders purchased units consisting of common stock and warrants in a       
private placement of our securities pursuant to a Private Placement Memorandum  
dated January 10, 2002, under Regulation S to non-U.S. residents of Canada,     
Europe and Australia, and under Regulation D to U.S. residents, all of which    
were accredited investors as that term is defined in Rule 501(a) of the Act. We 
agreed to file this registration statement for the resale of the shares         
purchased in the offering, the sale of the warrants, and the sale of the shares 
underlying the warrants. The warrants expired on May 31, 2003, and therefore the
sale of the warrants and the shares underlying the warrants are not included in 
this registration statement. We agreed to bear all out-of-pocket expenses of    
this offering, other than underwriting discounts and selling commissions. The   
selling shareholders may sell none, some, or all of the common stock offered by 
them as listed below.                                                           

The following table sets forth certain information with respect to the
beneficial ownership of shares of our common stock by the selling shareholders  
as of the date of this prospectus and the number of shares which may be offered 
pursuant to this prospectus for the account of each of the selling shareholders 
or their transferees from time to time.                                         

 The table assumes that each selling shareholder will sell all shares of
common stock offered pursuant to this prospectus, but not any other shares of   
common stock or warrants beneficially owned by such shareholder.                

                                                        [Enlarge/Download Table]

                               Shares     Maximum Shares         Shares Owned         
                               Owned        To Be Sold          After Offering        
                              Prior To        In The            --------------        
      Name                    Offering       Offering       Number          Percentage
      ----                    --------       --------       ------          ----------
                                                                                      
Elstree Nominees Pty Ltd      515,000        515,000             -0-            -0-   
Samson Exploration N.L.     2,007,500        500,000      1,507,500             15.4% 
James Capel (Nominees) Ltd.   300,000        300,000             -0-            -0-   
Clodene Pty Ltd                30,000         30,000             -0-            -0-   
Douglas Hall                   20,000         20,000             -0-            -0-   
Barry D. Lasker.              861,000(1)      20,000        841,000(1)           8.1% 
John Charles Grattan           10,000         10,000             -0-            -0-   
Dianne Kathleen Hall           17,000          7,000         10,000             <1%   
Thomas Conn                     5,000          5,000             -0-            -0-   
Dunford Pty Ltd.                2,000          2,000             -0-            -0-   

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(1)   Includes options to purchase 320,000 shares of common stock and promissory
note convertible into 500,000 shares of common stock.               

To the best of our knowledge, none of the selling shareholders has any
position, office or other material relationship with us or any of our affiliates
except as described below:                                                      

o    Victoria International Petroleum N.L. is one of our principal    
     shareholders, is wholly owned by Victoria Petroleum N.L., and the
 following directors of our company are also directors of both
     companies - Timothy L. Hoops, Robert J. Pett and John T. Kopcheff

   o    Elstree Nominees Pty Ltd was issued units in exchange for previously
        recorded advances, including interest thereon, previously made to us
      by Victoria Petroleum N.L. after Victoria transferred that debt to
Elstree.                                                    

o    Samson Exploration N.L. is one of our principal shareholders.    

     o    Barry D. Lasker is currently our President and CEO and a member of our
Board of Directors.                                         

PLAN OF DISTRIBUTION

The shares of common stock offered hereby may be sold by the selling  
shareholders or by their respective pledgees, donees, transferees or other      
successors in interest. Such sales may be made at fixed prices that may be      
changed, at market prices prevailing at the time of sale, at prices related to  
such prevailing market prices, or at negotiated prices. The securities may be   
sold by one or more of the following:                                           

   o    one or more block trades in which a broker or dealer so engaged will
      attempt to sell all or a portion of the shares held by the selling
      shareholders as agent but may position and resell a portion of the
block as principal to facilitate the transaction;           

    o    purchase by a broker or dealer as principal and resale by such broker
      or dealer as principal and resale by such broker or dealer for its
account pursuant to this prospectus;                        

   o    ordinary brokerage transactions and transactions in which the broker
solicits purchasers; and                                    

     o    privately negotiated transactions between the selling shareholders and
purchasers without a broker-dealer.                         

The selling shareholder may effect such transactions by selling the   
securities to or through broker-dealers, and such broker-dealers will receive   
compensation in negotiated amounts in the form of discounts, concessions,       
commission or fees from the selling shareholders and/or the purchasers of the   
securities for whom such broker-dealers may act as agent or to                  

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whom they sell as principal, or both (which compensation to a particular        
broker-dealer might be in excess of customary commissions). Such brokers or     
dealers or other participating brokers or dealers and the selling shareholders  
may be deemed to be "underwriters" within the meaning of the Securities Act of  
1933, in connection with such sales. Except for customary selling commissions in
ordinary transactions, any such underwriter or agent will be identified, and any
compensation paid to such persons will be described, in a prospectus supplement.
In addition, any securities covered by this prospectus that qualify for sale    
pursuant to Rule 144 might be sold under Rule 144 rather than pursuant to this  
prospectus.                                                                     

    To comply with some states' securities laws, if applicable, the securities
may be offered or sold by the selling shareholders in such jurisdictions only   
through registered or licensed brokers or dealers. In addition, in some states  
the securities may not be offered or sold by the selling shareholders unless    
they have been registered or qualified for sale in such states or an exemption  
from registration or qualification is available and is complied with.           

 EXPERTS

    The consolidated financial statements of Kestrel Energy, Inc. for the year
ended June 30, 2001 have been incorporated by reference herein and in the       
registration statement in reliance upon the report of KPMG LLP, independent     
certified public accountants, also incorporated by reference herein, and upon   
the authority of said firm as experts in accounting and auditing.               

  The consolidated financial statements of Kestrel Energy, Inc. as of June
30, 2002 have been incorporated by reference herein and in the registration     
statement in reliance upon the report of Wheeler Wasoff, P.C., certified public 
accounts, also incorporated by reference herein, and upon the authority of said 
firm as experts in accounting and auditing.                                     

 LEGAL MATTERS

    The validity of the common stock offered by this prospectus will be passed
upon for us by Davis Graham & Stubbs LLP, Denver, Colorado.                     

-12-

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘424B3’ Filing		Date		First		Last			Other Filings
		5/4/05		9
		1/31/05		8					8-K
		8/14/04		4
Filed on:		10/1/03							4
		9/29/03		1
		6/30/03		10					10KSB,  NT 10-K
		5/31/03		10
		5/5/03		8					8-K
		4/8/03		5
		3/31/03		7					10QSB
		2/4/03		8
		1/24/03		8
		12/31/02		7					10QSB,  NT 10-Q
		9/30/02		7					10QSB
		8/6/02		8
		7/1/02		7
		6/30/02		3		12			10KSB,  10KSB/A,  NT 10-K
		1/10/02		10
		6/30/01		12					10-K,  10-K/A,  NT 10-K
		6/30/00		9					10-K
		5/12/95		7
									List all Filings