FOR IMMEDIATE RELEASE

Craig M. Hammett - Vice President, Chief Financial Officer     (402) 341-4500
Jeffrey S. Laudin - Manager, Investor Relations                (402) 341-4500

              CalEnergy Announces $350 Million Senior Note Offering

                  OMAHA, NE, October 23, 1997: CalEnergy Company, Inc.
("CalEnergy" or the "Company") (NYSE, PCX and LSE Symbol: CE) announced today
that it has arranged for the sale of $350 million aggregate principal amount of
its 7.63% Senior Notes due 2007 ("Notes"). The notes have been rated BB+, Bal
and BBB- by Standard & Poor's, Moody's and Duff & Phelps, respectively.

                  The Company will use the net proceeds from $350 million Senior
Note Offering, together with approximately $700 million in net proceeds from the
public offering of 19.1 million shares of common stock which closed on October
17 and general corporate funds of the Company, to complete the acquisition of
all of the interests of Kiewit Diversified Group Inc. ("KDG") in the various
international power general projects ("Joint Venture Energy Projects") which are
jointly owned with the Company and managed by the Company, as well as the
repurchase of all of KDG's outstanding ownership interests in the Company's
Common Stock. The KDG acquisition agreement provides that the Company will pay
$1,155,000,000 for KDG's ownership interest in the Joint Venture Energy Projects
and the Company's Common Stock. The closing under the KDG acquisition agreement
is expected to occur in January, 1998.

                  Lehman Brothers Inc., Credit Suisse First Boston Corporation
and Merrill Lynch, Pierce, Fenner & Smith Incorporated are the managers of the
Senior Note offering.

                  A prospectus relating to the securities may be obtained from
Lehman Brothers Inc., Three World Financial Center, New York, New York 10285,
(212) 526-5055.

                  This release shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any state in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities law of any such state.

                  The Company, which manages and owns interests in over 5,000
net MW of power generation facilities in operation, construction and development
worldwide, currently operates 20 generating facilities and also supplies and
distributes electricity to 1.5 million customers. www.calenergy.com