April 10, 2007 16:21 ET

Arapahoe Energy Corporation Announces Shares for Debt Settlement for Trade Creditors and Filing of Audited Financial Statements and MD&A

CALGARY, ALBERTA--(CCNMatthews - April 10, 2007) - Arapahoe Energy Corporation (the "Corporation") (TSX VENTURE:AAO) announces that the Corporation has reached agreements for the satisfaction of outstanding indebtedness owed to its trade creditors in the amount of $6,344,781.99, representing over 94% of the indebtedness owed to all its trade creditors. Of this amount, $914,965 will be satisfied by the issue of 914,963 debenture units (the "Debenture Units") of the Corporation (the "Debt Settlement"). A Debenture Unit will consist of (i) a convertible secured debenture ("Debenture") in the amount of $1.50 (the "Repayment Amount") and (ii) four (4) purchase warrants ("Warrants"). The Debentures will be issued under an industry standard trust indenture. Each Warrant will entitle the holder thereof to purchase one common share of the Corporation during the period expiring on 24 month anniversary of the date of issuance at an exercise price of $0.125. For further information with respect to the Debenture Units please see the Corporation's news release dated March 12, 2007.

It is anticipated that the closing of the brokered financing of Debenture Units announced by the Corporation on March 12, 2007 will occur on April 11, 2007. Debt Settlement will occur on April 13, 2007.

The brokered financing and the issuance of the Debt Settlement is subject to the approval of the TSX Venture Exchange.

The Corporation also filed on April 5, 2007 its audited financial statements and management's discussion and analysis for the year ended December 31, 2006. Copies of the Corporation's annual financial statements and management's discussion and analysis for the year ended December 31, 2006 may be obtained at

Arapahoe Energy Corporation is a publicly traded junior oil and gas exploration, development and production company with operations in Western Canada. Arapahoe's shares trade on the TSX Venture Exchange under the symbol "AAO".

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

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