EXHIBIT 16.1


KPMG
      707 Seventeenth Street
      Suite 2700
      Denver, CO 80202


August 26, 2002


Securities and Exchange Commission
Washington, D.C.  20549


Ladies and Gentlemen:

We were previously principal accountants for Kestrel Energy, Inc. and, under the
date of September 14, 2001, we reported on the consolidated financial statements
of Kestrel Energy, Inc. as of June 30, 2001 and 2000 and for each of the years
in the three-year period ended June 30, 2001. On August 22, 2002, our
appointment as principal accountants was terminated. We have read Kestrel
Energy, Inc.'s statements included under Item 4 of its Form 8-K dated August 22,
2002, and we agree with such statements, except that we are not in a position to
agree or disagree with Kestrel Energy, Inc.'s statement that the change was
recommended and approved by the audit committee of the board of directors and
the board of directors and we are not in a position to agree or disagree with
Kestrel Energy, Inc.'s statement that Wheeler Wasoff P.C. was not engaged
regarding the application of accounting principles to a specified transaction or
the type of audit opinion that might be rendered on Kestrel Energy, Inc.'s
financial statements.

Very truly yours,

/s/ KPMG LLP