Storm Cat Energy Corporation Announces Closing of Series B Convertible Debt Placement



    DENVER and CALGARY, Alberta, April 3 /CNW/ -- Storm Cat Energy
Corporation (Amex:   SCU; TSX: SME) announced today the closing of US$31.66
million of Series B convertible notes, due in 2012, to qualified institutional
investors in a private placement pursuant to Regulation D of the Securities
Act of 1933, as amended, and exemptions from Canadian prospectus and
registration requirements under National Instrument 45-106.  The notes
initially will be convertible into 27,059,829 Storm Cat common shares at a
price of US$1.17 per share, subject to adjustments in accordance with the
terms of the notes.  The Company may force the conversion of the notes at any
time after 18 months if Storm Cat's common shares trade above US$2.05, as may
be adjusted, for 20 days within a period of 30 consecutive trading days.
    The Company plans to use the net proceeds from the sale of the Series B
notes to fund its 2007 capital expenditure budget requirements.
    The Company has entered into a registration rights agreement with the
purchasers of the Series B notes pursuant to which it is obligated to file
with the U.S. Securities and Exchange Commission a resale registration
statement relating to the common shares to be issued upon conversion of the
notes.
    The above-described securities have not been registered under the
Securities Act of 1933 or any state securities laws, and unless so registered
may not be offered or sold in the United States, except pursuant to an
exemption from, or in a transaction subject to, the registration requirements
of the Securities Act of 1933 and applicable state securities laws. This press
release is issued pursuant to Rule 135c of the Securities Act of 1933, and
does not constitute an offer to sell, or the solicitation of an offer to buy,
nor shall there be any sale of the notes or common shares in any jurisdiction
in which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such
jurisdiction.
    In Canada, the notes and any shares issued on conversion of the notes are
subject to a 4-month hold period and may not be traded before July 31, 2007
unless permitted under applicable securities legislation and the rules of the
Toronto Stock Exchange.

    
    About Storm Cat Energy
    
    Storm Cat Energy is an independent oil and gas company focused on the
pursuit, exploration and development of large unconventional gas reserves from
fractured shales, coal beds and tight sand formations. The Company has
producing properties in Wyoming's Powder River Basin, and exploitation and
development acreage in Canada, Arkansas and Alaska. The Company's shares trade
on the American Stock Exchange under the symbol "SCU" and in Canada on the
Toronto Stock Exchange under the symbol "SME."

    Storm Cat Energy Corporation

    
    Keith Knapstad
    Acting President and Chief Executive Officer

    /s/ Keith Knapstad

    Company Contact:
    Paul Wiesner, Chief Financial Officer
    Phone: 87-STORMCAT
    www.stormcatenergy.com

    Forward-looking Statements
    

    This press release contains certain "forward-looking statements", as
defined in the United States Private Securities Litigation Reform Act of 1995,
and within the meaning of Canadian securities legislation, relating to the
proposed use of proceeds.  Forward-looking statements are statements that are
not historical facts; they are generally, but not always, identified by the
words "expects," "plans," "anticipates," "believes," "intends," "estimates,"
"projects," "aims," "potential," "goal," "objective," "prospective," and
similar expressions, or that events or conditions "will," "would," "may,"
"can," "could" or "should" occur. Forward-looking statements are based on the
beliefs, estimates and opinions of Storm Cat's management on the date the
statements are made and they involve a number of risks and uncertainties.
Consequently, there can be no assurances that such statements will prove to be
accurate and actual results and future events could differ materially from
those anticipated in such statements.  Storm Cat undertakes no obligation to
update these forward-looking statements if management's beliefs, estimates or
opinions, or other factors, should change.  Factors that could cause future
results to differ materially from those anticipated in these forward-looking
statements include, but a change in the use of proceeds, the volatility of
natural gas prices, the possibility that exploration efforts will not yield
economically recoverable quantities of gas, accidents and other risks
associated with gas exploration and development operations, the risk that the
Company will encounter unanticipated geological factors, the Company's need
for and ability to obtain additional financing, the possibility that the
Company may not be able to secure permitting and other governmental clearances
necessary to carry out the Company's exploration and development plans, and
the other risk factors discussed in greater detail in the Company's various
filings on SEDAR (www.sedar.com) with Canadian securities regulators and its
filings with the U.S. Securities and Exchange Commission, including the
Company's Form 10-K for the fiscal year ended December 31, 2006.

    
           NO STOCK EXCHANGE HAS REVIEWED OR ACCEPTS RESPONSIBILITY
              FOR THE ADEQUACY OR ACCURACY OF THIS NEWS RELEASE.

    




For further information:

For further information: William Kent, Director, Investor Relations of 
Storm Cat Energy Corporation, +1-303-991-5070

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STORM CAT ENERGY CORPORATION

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