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                                                                    EXHIBIT 10.4
                                                                    ============

                  First Amendment to the Amended and Restated

                              Employment Agreement

                                       of

                                Paul E. Shampay

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     This FIRST AMENDMENT TO THE AMENDED AND RESTATED EMPLOYMENT AGREEMENT OF
PAUL E. SHAMPAY ("Amendment") is made by and between KAISER VENTURES INC.
("Kaiser") and PAUL E. SHAMPAY ("Employee") as of April 11, 2001.

                                    Recitals

     A.  Employee is currently employed by Kaiser pursuant to that certain
Amended and Restated Employment Agreement between Kaiser and Employee dated as
of September 19, 2000 (the "Employment Agreement").

     B.  Under the terms of the Employment Agreement, Employee is entitled to
the payment of certain compensation as measured by a fixed percentage or a
percentage based upon the average percentage bonus paid to Employee over the
prior of five years (or such other shorter period of time that Employee has been
an executive officer of the Company) from the date of the percentage
determination.

     C.  Kaiser has made the determination to terminate its existing annual
executive bonus program as generally described in Paragraph 4.a. of the
Employment Agreement.  Accordingly, the applicable bonus percentage shall be a
fixed percentage for purposes of the Employment Agreement.

     NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Kaiser and Employee agree as
follows:

     1.  Recitals.  The Recitals set forth above are true and correct and are
incorporated herein by this reference.

     2.   Discontinuance of Annual Performance Bonus Described in Paragraph 4.a.
Employee acknowledges that the Company has discontinued its historical annual
performance bonus program applicable to all executive officers for calendar
years beginning in 2001.  Employee acknowledges and agrees that any future bonus
shall be in the total discretion of the Board of the Directors of Kaiser, except
for:  (i) any bonus pursuant to the long term Transaction Incentive Plan
described in Paragraph 4.b.; and (ii) any bonus described in Paragraph 12.

     3.   Amendment of Paragraph 8.  The following sentence in Paragraph 8 is
hereby deleted:  "Employee's anticipated bonus shall be calculated by
multiplying Employee's average percentage bonus paid over the prior five years
by Employee's then annual base salary." and the following sentence substituted
therefore:  "Employee's anticipated bonus shall be calculated based upon the
performance bonus, if one is paid to his peers for the year of Employee's death
by Board of Directors action, assuming that he would have received a bonus
relatively equal to the amount received by his peers."

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     4.  Amendment of Paragraph 12.a.  Paragraph 12.a. is hereby deleted in its
entirety and a new Paragraph 12.a. as follows is substituted therefore:

         a.      if the termination is effective after March 31 of any year, an
amount equal to the pro rata portion of the annual performance bonus, if any,
that Employee would have been eligible to earn for the year of termination based
upon the performance bonus, if one is paid to his peers for the year of
termination by Board of Directors action, assuming he would have received a
bonus relatively equal to the amount received by his peers.

     5.  Amendment of Paragraph 12.c.  Paragraph 12.c. is hereby amended by the
deletion of such paragraph in its entirety and substituting therefor the
following new Paragraph 12.c.:

         c.      the amount that results from multiplying 50% by the greater of
Employee's then current annual base salary or his base salary in effect as of
the date of this Amendment (this represents an amount equal to one year's
average annual bonus paid over the five (5) years prior to and including the
final annual bonus for the year 2000 (or such lesser period of time during which
Employee was eligible to receive a bonus) paid under Kaiser's executive annual
bonus program).

     6.  Deletion in Paragraph 12.  Paragraph 12 is hereby further amended by
the deletion of the second to the last paragraph (the penultimate paragraph) of
Paragraph 12 and no new paragraph is substituted therefor.

     7.  Ratification of Employment Agreement as Amended.  The Employment
Agreement is not amended in any respect except as expressly provided herein, and
the Employment Agreement as amended by this Amendment is hereby ratified and
approved in all respects.

     8.  Governing Law.  This Amendment shall be governed by and construed in
accordance with the laws of the State of California.

     IN WITNESS WHEREOF, the parties hereto have executed this Amendment to the
Employment Agreement to be effective as of the day and year first written above.

<TABLE>
<CAPTION>
"Employee"                                        "Kaiser"
Paul E. Shampay                                   Kaiser Ventures Inc.

<S>                                               <C>
By:    /s/ Paul E. Shampay                        By:    /s/ Richard E. Stoddard
       -----------------------------                     --------------------------------------
       Paul E. Shampay                                   Richard E. Stoddard
                                                         Chairman of the Board, Chief Executive
                                                          Officer and President




                                                  By:    /s/ Todd G. Cole
                                                         --------------------------------------
                                                         Todd G. Cole, Chairman
                                                         Human Relations Committee

</TABLE>

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