Arsenal Energy Inc.

Arsenal Energy Inc.

March 15, 2007 17:44 ET

Arsenal Completes Drilling of SET-1 Well in Egypt

CALGARY, ALBERTA--(CCNMatthews - March 15, 2007) -


Arsenal Energy Inc. ("Arsenal") (TSX:AEI) (FRANKFURT:A1E) announced the SET-1 test well was drilled to a total depth of approximately 4,500 feet. The well encountered an excellent trap and reservoir however, no hydrocarbons were encountered and the well has subsequently been plugged and abandoned. The drilling rig is currently being moved to the NARMER-1 drilling location which is approximately 17 miles from the SET-1 location. The NARMER-1 has a target depth of 7,800 feet and will test a separate structure with Cretaceous and Jurassic potential. It is expected that the NARMER-1 will commence drilling on March 24th and take approximately 40 days to drill and evaluate.

Arsenal and its' partners have a third location which is in the process of being approved by the Egyptian government. This well, which is contingent on the results of the first two wells, could be spud in the third quarter of 2007 and could test another independent structure approximately 4 miles from the NARMER-1 location.

The 5.625 million acre Nuqra concession is land-based and located in the Upper Nile region in Egypt with rift basins that are analogous to highly prolific structures located to the East in Yemen, to the South in Sudan and to the North West in Libya which have yielded significant reserve and production volumes.

Arsenal is an aggressive junior oil and gas company engaged in the exploration for, and development and production of natural gas and oil reserves primarily in the provinces of Alberta and Saskatchewan, North Dakota, U.S.A. and Egypt. Arsenal's common shares trade on the Toronto Stock Exchange under the symbol "AEI" and on the Frankfurt Stock Exchange under the symbol "A1E".

Certain statements in this material may be "forward-looking statements" including outlook on oil and gas prices, estimates of future production, estimated completion dates of acquisitions and construction and development projects, business plans for drilling and exploration, estimated amount and timing of capital expenditures and anticipated future debt levels and royalty rates. Information concerning reserves contained in this material may also be deemed forward-looking statements as such estimates involve the implied assessment that the resources described can be profitably produced in the future. These statements are based on current expectations, estimates and projections that involve a number of risks and uncertainties, which could cause actual results to differ from those anticipated by Arsenal.

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