Storm Cat Energy Corporation Announces Year-End 2006 Results




    - Gas Production Increases 132%

    - Oil and Gas Sales Revenue Increases 124%

    - 100 Wells Drilled During 2006

    DENVER & CALGARY, ALBERTA, March 19 /CNW/ - Storm Cat Energy Corporation
(AMEX:   SCU; TSX: SME) today announced year-end 2006 financial and operating
results.

    Financial Overview (all figures in U.S. Dollars)

    For the year ended December 31, 2006 Storm Cat reported record oil and
gas sales revenue of $9.4 million, a 124 percent increase over full-year 2005
sales. Sales revenue is a function of sales volumes and average sales prices.
Sales volumes increased 132% between year-end 2005 and year-end 2006. The
volume increase resulted primarily from acquisitions and successful drilling
over the past year that produced new sales volumes that offset the natural
decline in production from existing wells. The Company's average price for
natural gas decreased 3% to $5.88 per thousand cubic feet (Mcf) in 2006 from
$6.08 per Mcf in 2005.

    The Company reported a net loss of $6.9 million, or $0.10 per share, for
the full-year 2006, as compared to a net loss of $8.4 million, or $0.18 per
share, for the full-year 2005. The net loss for the year reflected a $1.9
million impairment expense, incurred in the third quarter, related to the
Company's Moose Mountain Saskatchewan Project, and higher general and
administrative expenses, composed primarily of $2.8 million in non-cash
employee stock compensation expense, increased Sarbanes-Oxley and audit fees
of $0.3 million, increased Director and Officer insurance of $0.2 million and
a one-time charge of $0.5 million related to the bank credit facility entered
into during the year. Net income for 2006 also reflected a tax benefit of $1.6
million related the Canadian flow through shares.

    Total assets increased 96% to $112.0 million in 2006 from $57.0 million
in 2005. The book value of oil and gas properties increased 289% to $96.6
million at year-end 2006 from $24.8 million at year-end 2005.

    Weighted average shares outstanding for year-end 2006 increased to 70.4
million as compared to 47.3 million at year-end 2005. The increase in average
shares outstanding is attributed to the private placement the Company
completed in Canada using, in part, the flow-through share structure, as well
as the exercise of outstanding warrants and options.

    Keith Knapstad, acting President and Chief Executive Officer commented:
"Storm Cat achieved numerous milestones in 2006. We high-graded our asset
portfolio through strategic purchases in the Powder River Basin, our core
producing area, as well as with acquisition of quality acreage in the
Fayetteville Shale play in the Arkoma Basin. We executed our drilling program,
drilling 100 wells. We tripled year-end production, and nearly tripled our
proven reserves to 28.7 Bcf, with approximately 9.5 Bcf of developed reserve
additions coming through the drill bit. Entering 2007, Storm Cat is moving
forward on the strong momentum built during 2006. We will continue an
aggressive drilling program in the Powder River Basin, begin to advance our
development in the Fayetteville Shale play and continue ongoing activities in
Elk Valley and Canada."

    Operating Overview

    Production

    Since October 2004, Storm Cat has acquired a significant and highly
prospective acreage portfolio targeting unconventional gas. Through drilling
and acquisitions in the Powder River Basin (PRB), net production increased
132% to 1,606.2 million cubic feet (MMcf) for the full year 2006 from 693.5
MMcf in the prior year. For the full-year 2006, the Company reported average
daily net sales production of 4.4 million cubic feet per day (MMcf/d) as
compared to 1.9 MMcf/d for the full year 2005. Net production from the PRB
averaged 8.0 MMcf/d at year end.

    Reserves

    As previously announced, year-end 2006 proven reserves, based on SEC
pricing of $4.46 per thousand British thermal units, were 25.0 Bcf, probable
reserves were 5.9 Bcf and possible reserves were 26.4 Bcf. Approximately 54%
of the proven reserves were classified as proved developed. The 2006 estimated
quantities of proven reserves are 150% higher than year-end 2005 proven
reserves of 10.0 Bcf. In addition, Storm Cat increased proved developed
reserves by 244% at year-end 2006. All reserve estimates are based on an
evaluation of the reserves prepared by independent reservoir engineering
consultants, Netherland Sewell and Associates, Inc.

    In addition to the SEC reserve report, Storm Cat estimated year end
proven, possible and probable reserves using available current strip pricing.
Using current strip pricing, proven reserves are 28.7 Bcf, probable reserves
are 9.0 Bcf and possible reserves are 28.2 Bcf.

    Pricing

    The average realized sales price of natural gas was $5.88 per Mcf for the
full-year 2006, down from $6.08 per Mcf in the prior year.

    Storm Cat's fixed-price natural gas hedges are summarized as follows:

    
    Fixed-priced Financial Hedges

    -- 1.5 MMBtu/day
    -- U.S. $7.16 Colorado Interstate Gas (CIG)
    -- August 2006 through July 2009

    -- 2.0 MMBtu/day
    -- U.S. $7.27 CIG
    -- September 2006 through August 2009

    -- 2.4 MMBtu/day
    -- U.S. $5.12 CIG
    -- January 2007 through December 2007

    -- 1.2 MMBtu/day
    -- U.S. $6.61 CIG
    -- January 2008 through December 2008
    

    Drilling Activities

    The Company drilled and completed 100 wells in 2006, 86 of which were in
the PRB. These wells were primarily located within the Company's Northeast
Spotted Horse acreage. Storm Cat currently has as many as three rigs running
in the PRB and expects to drill approximately 150 wells on its various acreage
positions during 2007.

    The Company drilled and completed five wells in Elk Valley during 2006.
These wells are currently on production and de-watering. The Company expects
indicative results for these wells to be available late in the third quarter
of 2007.

    Financial and operations tables accompany this release. Please reference
the Company's filing on Form 10-K with the Securities and Exchange Commission
and with Canadian securities regulators on SEDAR for important notes to the
financial statements.

    For further shareholder inquiries please contact Storm Cat Energy
Investor Relations at 303-991-5070 or at info@stormcatenergy.com.

    About Storm Cat Energy Corporation

    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, exploration 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."

    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 matters
such as the Company's drilling and other exploration plans and projected well
economics. 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; including production and reserve estimates, and potential
benefits to Storm Cat of such acquisitions, 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 are not limited
to receipt of necessary approval from regulatory bodies, the failure to
achieve the anticipated benefits of the acquisition, the failure to close the
acquisition, 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 ACCEPTED RESPONSIBILITY FOR THE
ADEQUACY OR ACCURACY OF THIS NEWS RELEASE.

    
                            SELECT OPERATING DATA

    Selected Operating Data:                      Year Ended December 31,
                                                  ------------------------
                                                     2006         2005
                                                  -----------  -----------
      Net Sales Volume:
             Natural Gas (MMcf)                      1,606.2        693.5

      Oil and Gas Sales (in thousands)
             Natural Gas                              $9,444       $4,214

      Average Sales Prices:
             Natural Gas (per Mcf)                     $5.88        $6.08

      Additional Data (per Mcf):
             Gathering and Transportation              $1.20        $1.31
             Lease Operating Expenses                  $1.49        $2.61
             Ad Valorem and Property Taxes             $0.65        $0.78
             Depreciation, Depletion and
              Amortization                             $2.22        $2.28
             General and Administrative, net of
              capitalization                           $2.55        $5.20
             Stock-based Compensation                  $1.73        $2.76
    

    
                         CONSOLIDATED BALANCE SHEETS
       (Stated in U.S. Dollars and in thousands, except share amounts)

                                                December 31,  December 31,
                                                   2006          2005
                                                ------------  ------------
                                    ASSETS
      CURRENT ASSETS:
       Cash and cash equivalents                     $5,299       $29,502
           Accounts receivable:
               Joint Interest Billing                 1,932           703
               Revenue Receivable                     2,121           504
       Fair Value of Derivative Instruments -
        Current                                       2,670             0
       Prepaid Costs and Other Current Assets         1,445           445
                                                ------------  ------------
           Total Current Assets                      13,467        31,154
      PROPERTY AND EQUIPMENT:
       Oil and gas properties:
           Unproved Properties                       54,873         8,249
           Proved Property, net of impairments       46,446        18,071
           Less accumulated depreciation,
            depletion, amortization and
            accretion                                (4,764)       (1,502)
                                                ------------  ------------
           Oil and gas properties, net               96,555        24,818
                                                ------------  ------------
       Fixed Assets                                   1,057           911
       Accumulated Depreciation                        (408)         (106)
                                                ------------  ------------
           Total other property, net                    649           805
                                                ------------  ------------
           Total property and equipment, net         97,204        25,623
                                                ------------  ------------
       Restricted Investments                           511           176
       Fair Value of Derivative Instruments -
        Long Term                                       782             0
                                                ------------  ------------
                                                      1,293           176
                                                ------------  ------------
           Total Assets                            $111,964       $56,953
                                                ------------  ------------
                     LIABILITIES AND STOCKHOLDERS' EQUITY
      CURRENT LIABILITIES:
       Accounts Payable                              $7,302        $3,815
       Revenue Payable                                2,063           313
       Accrued & Other Liabilities                   10,011         7,850
       Flow-Through Shares Liability                  1,233           731
       Notes Payable - Current                        7,500             0
       Interest Payable                                 952             0
                                                ------------  ------------
           Total Current Liabilities                 29,061        12,709
       Asset Retirement Obligation                    1,871           793
        Notes Payable-Long Term                      19,350             0
                                                ------------  ------------
                                                     21,221           793
                                                ------------  ------------
           Total Liabilities                         50,282        13,502
                                                ------------  ------------
           Commitments and Contingencies                  -             -
    STOCKHOLDERS' EQUITY
       Common Stock, without par value,
        unlimited common shares authorized,
        issued and outstanding: 80,429,820 at
        December 31, 2006 and 65,654,388 at
        December 31, 2005                            69,518        50,858
       Contributed Surplus                            4,910         2,204
       Accumulated Other Comprehensive Income         3,877           151
       Accumulated Deficit                          (16,623)       (9,762)
                                                ------------  ------------
           Total Stockholders' Equity                61,682        43,451
                                                ------------  ------------
           Total Liabilities and Stockholders'
            Equity                                 $111,964       $56,953
                                                ------------  ------------
    

    
                    CONSOLIDATED STATEMENTS OF OPERATIONS
     (Stated in U.S. Dollars and in thousands, except per share amounts)

                                                  Year Ended December 31,
                                                  ------------------------
                                                     2006         2005
                                                  -----------  -----------
    OPERATING REVENUES:
       Oil and gas revenue                            $9,444       $4,214

      EXPENSES:
       Operating Costs
           Gathering & transportation                  1,921          906
           Operating expenses                          3,443        2,354
       General & administrative expenses               6,880        5,520
       (Gain) loss on property sales                    (185)          56
       Accretion expense                                 213           65
       Depreciation, depletion, & amortization         3,703        1,583
       Impairment                                      2,027        2,125
                                                  -----------  -----------
               Total Operating Expenses               18,002       12,609
                                                  -----------  -----------
       Operating loss                                 (8,558)      (8,395)
      OTHER EXPENSE (INCOME)
       Loss (Gain) on foreign exchange                    11           98
       Interest and other misc. income                  (184)        (125)
                                                  -----------  -----------
               Net loss before taxes                  (8,385)      (8,368)

       Recovery of future income tax asset            (1,524)           0
                                                  -----------  -----------

      NET LOSS                                       $(6,861)     $(8,368)
                                                  -----------  -----------
      Basic and diluted loss per share                $(0.10)      $(0.18)
      Weighted average number of shares
       outstanding                                70,429,219   47,321,481
    

    
                     CONSOLIDATED STATEMENT OF CASH FLOWS
       (Stated in U.S. Dollars and in thousands, except share amounts)

                                                    For the Year Ended
                                                       December 31,
                                                 -------------------------
                                                    2006          2005
                                                 ------------  -----------
    Cash flows from operating activities:
        Net Loss                                     $(6,861)     $(8,368)
        Adjustments to reconcile net loss to net
         cash used in operating activities:
                Recovery of future tax asset          (1,524)           -
                Stock-based compensation               2,707        1,914
                Depreciation, depletion and
                 amortization                          3,564        1,572
                Impairments                            1,975        2,125
                Asset retirement obligation              213           65
                Gain on disposition of properties       (185)         (56)
                Changes in operating working
                 capital:
                    Changes in operating assets
                     and liabilities:
                        Accounts receivable           (3,180)      (1,099)
                        Other current assets            (666)        (360)
                        Accounts payable              (3,331)         509
                        Other current liabilities      4,601        1,426
                                                 ------------  -----------
                Net cash used in operating
                 activities                           (2,687)      (2,272)
                                                 ------------  -----------
    Cash flows from investing activities:
        Restricted investments                          (335)        (150)
        Capital expenditures - oil and gas
         properties                                  (71,258)     (14,766)
        Proceeds from sale                             1,000            -
        Other capital expenditures                      (145)        (817)
                                                 ------------  -----------
            Net cash used in investing activities    (70,738)     (15,733)
                                                 ------------  -----------
    Cash flows from financing activities:
        Issuance of shares of stock for cash          18,660       44,189
        Flow-through shares                            2,755          731
        Bank debt                                     35,032            -
        Repayment of bank debt                        (7,500)
                                                 ------------  -----------
            Net cash provided by financing
             activities                               48,947       44,920
                                                 ------------  -----------
    Effect of exchange rate changes on cash              275          (78)
                                                 ------------  -----------
    Net increase (decrease) in cash and cash
     equivalents                                     (24,203)      26,837
    Cash and cash equivalents and beginning of
     period                                           29,502        2,665
                                                 ------------  -----------
    Cash and cash equivalents at end of period        $5,299      $29,502
                                                 ------------  -----------
    




For further information:

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

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STORM CAT ENERGY CORPORATION

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