February 26, 2007 14:41 ET

Arapahoe Energy Corporation: News Release

CALGARY, ALBERTA--(CCNMatthews - Feb. 26, 2007) - Arapahoe Energy Corporation (TSX VENTURE:AAO) ("Arapahoe" or the "Corporation") announces that it has received an extension from its principal lender to extend the forbearance period set out in the forbearance agreement that the Corporation entered into with its principal lender on January 8, 2007, to March 31, 2007. The Corporation continues to investigate and pursue strategic alternatives which include equity financing, alternative types of financing, asset disposition(s), corporate amalgamations or business combinations. The Corporation currently has a working capital deficit of approximately $11,511,673.

Arapahoe's production averaged approximately 400 BOE's per day for the month of January 2007 and is expected to average approximately 450 BOE's per day for the month of February 2007.

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".

Forward-looking statements are based on current expectations that involve a number of risks and uncertainties. These risks and uncertainties, many of which are beyond Arapahoe's control, include the impact of general economic conditions and specific industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, the lack of available qualified personnel or management, stock market volatility and ability to access sufficient capital from internal or external sources. The Corporation's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements, and accordingly, no assurance can be given that any events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what benefits Arapahoe can derive there from.

Per barrel of oil equivalent amounts have been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil ("6:1"). The 6:1 conversion ratio is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Barrels of oil per day equivalency disclosure may be misleading, particularly if used in isolation.

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

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