May 23, 2006 16:09 ET

Arapahoe Energy Corporation: News Release

CALGARY, ALBERTA--(CCNMatthews - May 23, 2006) - Arapahoe Energy Corporation (TSX VENTURE:AAO) (the "Corporation" or "Arapahoe") announces that it has entered into agreements whereby Arapahoe will, subject to certain conditions, acquire an additional 65% interest in the Campbell 15-33-54-25W4M well and surrounding 2,560 gross acres.

The acquisition price is $5.2 million and will be financed by Arapahoe increasing its bank line of credit to $7.5 million.

At Closing Arapahoe's interest in the 15-33 well and the Campbell project will increase to 77.5% and Arapahoe will become the operator. Closing is expected to occur on or before May 27, 2006.

Arapahoe is a junior oil and gas exploration company engaged in the exploration, development and production of oil and natural gas in Western Canada. Arapahoe's primary areas of focus are on First Nation lands in western Canada. Currently Arapahoe has exploration and development agreements in place with the Tsuu T'ina First Nation, immediately west of the City of Calgary and with the Poundmaker Cree Nation in south west Saskatchewan.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this news release.

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