Arcan Resources Ltd. (TSX VENTURE:ARN) ("Arcan" or the "Company"), is pleased to provide an update on its net asset value, year end reserves and year end results as well as the expansion of its revolving credit facility to $40 million.

2007 Highlights

- Raised net asset value 49% to $3.34 per diluted share from $2.24 per diluted share;

- Achieved operating netbacks of $35.97 per boe (revenue of $63.97 per boe);

- Increased proved and probable reserve boes by 41% from 5.1 million boe to 7.2 million boe and estimated present value of future net revenue by 110% (proved plus probable, discounted at 10%);

- Created 1.5 times recycle ratio on 2.5 mboe proved plus probable reserve additions and a $24.11 FD&A cost (with significant investments in waterflood infrastructure), providing the Company with a 5.8 times replacement ratio and a 17.5 year reserve life index using fourth quarter production;

- Production more than doubled to an average of 1,178 boe per day for 2007 from an average of 581 boe per day for the 12 months ended December 31, 2006 with increases coming from each of the three core areas;

- Recorded record revenues of $27.5 million and annual funds from operations of $10.9 million or $0.33 per diluted share;

- Purchased an additional five percent interest in the Deer Mountain Unit #2; and

- Commenced water injection and acquired operatorship of a battery in Hamburg and advanced the development of the waterflood in Deer Mountain.

In the first quarter of 2008, Arcan produced just under 1,500 boe per day, with March 2008 averaging over 1,700 boe per day. Actual production rates peaked above 2,400 boe per day however these rates are not sustainable due to MRL restrictions.

                                                     Six Months
                                       Year Ended         Ended  Year Ended
                                      December 31,  December 31,    June 30,
Highlights                                   2007          2006        2006
----------------------------------------------------------------------------
Financial ($000's, except per share
 amounts)

Oil and natural gas revenues               27,505         6,304       6,699
Cash provided by operating activities      11,429         2,348       2,882
Funds flow from operations (1)             10,927         2,689       3,336
 Per share - basic (1)                       0.33          0.11        0.23
Net loss                                     (910)         (318)     (1,563)
 Per share - basic and diluted              (0.03)        (0.01)      (0.11)
Bank loan                                  13,906        11,502           -
Total assets                              123,285        82,019      57,854
Total liabilities                          43,815        33,888      14,802
Shareholders' equity                       79,471        48,130      43,052
Capital expenditures - cash                50,272        33,776      34,149
Common shares outstanding                  36,492        26,534      24,542
 Weighted average - basic                  32,724        25,295      14,508
 Weighted average - diluted (3)            32,724        25,295      14,508
----------------------------------------------------------------------------
Sales Volumes
Crude oil and NGL's (bbls per day)            798           373         127
Natural gas (mcf per day)                   2,278          1377       1,209
Barrels of oil equivalent
 (boe per day) (2)                          1,178           603         329
----------------------------------------------------------------------------

(1) The reader is referred to the section - "Non-GAAP Measurements" in the
    MD&A.
(2) The reader is referred to the section - "Oil, Natural Gas Liquids and
    Natural Gas Conversions to BOEs".
(3) Basic and diluted weighted average shares are the same as the Company
    has a loss.

The Company achieved a 49% growth in net asset value to $3.34 per diluted share on a cost effective basis after investing in two waterflood projects on key oil assets.

----------------------------------------------------------------------------
Net Asset Value                             December 31, 2007
----------------------------------------------------------------------------
($millions except number of           (Proved plus             Proved plus
 shares and per share)      Probable discounted at  Probable discounted at
                                                 5%)                    10%)
----------------------------------------------------------------------------
Present value of reserves                    197.9                   153.6
----------------------------------------------------------------------------
Undeveloped acreage (2007 -
 $290 per acre)                                9.5                     9.5
----------------------------------------------------------------------------
Seismic                                        1.0                     1.0
----------------------------------------------------------------------------
Working capital deficit                      (30.1)                  (30.1)
----------------------------------------------------------------------------
Dilution proceeds (1)                          8.2                     8.2
----------------------------------------------------------------------------
Estimated value                              186.5                   142.1
----------------------------------------------------------------------------

----------------------------------------------------------------------------
Shares (thousands)                         42.5(1)                 42.5(1)
----------------------------------------------------------------------------
Estimated NAV per share (1)                   4.38                    3.34
----------------------------------------------------------------------------
(1) Includes all dilutive securities namely: 36,491,555 common shares; the
    Performance Shares convertible into 1,335,005 common shares (which
    conversion was affected in March, 2008); 1,500,000 performance warrants
    exercisable at $1.00 per share; 598,631 warrants exercisable at $1.93
    per share; and 2,612,500 stock options that are in the money at their
    average exercise price of $2.11 (these were all options exercisable
    below the $3.34 NAV above) (2006 - 2,483,500 options at $1.95, 1,500,000
    performance warrants at $1.00 and 1,287,810 warrants at $1.65. These
    values were used as Arcan was not public at that time).

Arcan increased its Proved plus Probable reserves by 49% (including production) to 7.2 million boe. The values below are based on the Company's December 31, 2007 reserve report prepared by GLJ that is summarized in the AIF being filed concurrently on SEDAR. Estimates of future net revenue do not represent fair market value.

----------------------------------------------------------------------------
                            RESERVES CATEGORY          NPV (BT Discounted%)
----------------------------------------------------------------------------
                            Natural
                 Light Oil      Gas   NGL's   TOTAL
                     Gross    Gross   Gross   Gross
                        (1)      (1)     (1)     (1)      0       5      10
                    (Mbbls)   (MMcf) (Mbbls)  (Mboe)   (MM$)   (MM$)   (MM$)
PROVED
Developed
 Producing            2,400   3,177     334   3,264 $ 127.2 $  91.7 $  73.0
Total Proved          3,795   4,207     426   4,922 $ 189.2 $ 140.5 $ 112.4
PROBABLE              1,645   2,549     191   2,233 $ 102.8 $  57.3 $  41.1
TOTAL PROVED +
 PROBABLE             5,441   6,590     617   7,156 $ 281.3 $ 197.9 $ 153.6

(1) "Gross Reserves" are Company's working interest share of remaining
    reserves before the deduction of royalties and are as at December 31,
    2007.

Overview

In the fifteen months since Arcan became a publicly traded company, we have increased reserves, overcome production hurdles, made significant investments in infrastructure in the two waterflood projects, and increased the Company's net asset value per share by 49% to $3.34 per diluted share (proved plus probable discounted at 10%). Net asset value continues to be our primary focus. In Hamburg, Arcan has foregone numerous short-term production gains to maximize pool recovery and long term net asset value. In Deer Mountain, water injection and extensive development drilling remains the key to adding significant shareholder value. Arcan has invested in two major waterflood projects on high quality Devonian oil pools over the last two years. These enhanced recovery (ER) schemes required an intensive up-front investment of time and capital. These operations were major milestones which are expected to significantly increase recoverable reserves and ultimately net asset value.

Arcan expended $57.8 million ($59.3 million including future tax on the Desco acquisition) on its properties and infrastructure during the year ended December 31, 2007, expanding net asset value by $95.7 million and replacing production by 5.8 times over December 31, 2006. Our investments left Arcan with a 17.5 year reserve life index (using fourth quarter production) weighted 76% towards light oil and an inventory of 7.2 mmboe of proved plus probable reserves. For 2007 Arcan had record funds from operations of $10.9 million and a recycle ratio of 1.5 times based on proved plus probable FD&A costs of $24.11 per boe and a 2007 corporate netback of $35.97 per boe. Arcan exited 2007 with $30.1 million in debt and working capital and for 2008 anticipates spending within cash flow and its new $40 million in bank line.

Arcan started 2007 with production of 800 boe per day and exited with a number of very productive wells under regulatory limitations, holding our production to just over 1,100 boe per day. Delays of this nature are related to the timing of implementation, rather than being related to problems with the assets themselves. Production rates for 2007 were less than management had expected. Arcan is aware of the importance of the timeline to convert those maximum rate limitations (MRLs) to good production practices (GPP) in Hamburg. The Company is providing information and working with the ERCB to facilitate the removal of the MRLs and minimize these delays.

Production from 2007 was fairly evenly split between Arcan's three core areas totalling to a net 1,178 boe per day, a 103% increase from 581 boe per day average production for the 12 months ended December 31, 2006. For the three months ended December 31, 2007 production was 1,122 boe per day which is higher than the 775 boe per day average production for the three months ending December 31, 2006. Since the end of the year Arcan has tied in two (1.0 net) productive wells in the Hamburg GG pool and installed a new treater. Production has risen to average over 1,700 boe per day in March, 2008. Both the timing of GPP status on the remaining Hamburg wells and pressure response in Deer Mountain will have a significant impact on Arcan's 2008 production profile.

Arcan is now the operator of the majority of its three core properties, which are located in West Central and Northwest Alberta. Arcan is able to re-allocate capital expenditures within its 3 core areas among exploration and development drilling for both oil and/or natural gas. Arcan has a large inventory of infill oil locations with low risk profiles, high reserve potential and high operating netbacks. Paramount to Arcan and to its management team is adding value for the Company's shareholders. With significant infrastructure investments in place we foresee adding production and reserves at a lower capital cost during 2008. We are oil weighted and will continue to benefit from record oil prices as we direct our investments into these areas. We are monitoring and planning for the impact of the proposed changes to the Alberta royalty rates.

At December 31, 2007 Arcan had 17 full time employees.

Expansion of Credit Facility - Arcan has entered into an agreement with its bank lender, Alberta Treasury Branch, to increase the amount available under its revolving operating credit facility from $20 million at the start of 2007 to $40 million, after factoring in the impact of the NRF.

Additional information regarding Arcan's annual results including the Annual Information Form, the Management Discussion and Analysis for the three and twelve month periods ending December 31, 2007, the three and six month periods ended December 31, 2006 and the twelve month period ended June 30, 2006, and the audited financial statements for the year ended December 31, 2007, the six months ended December 31, 2006 and the year ended June 30, 2006, together with the notes related thereto, are being filed by Arcan concurrently with this press release and will be available under Arcan's SEDAR profile at www.sedar.com.

Arcan Resources Ltd. is an Alberta, Canada corporation that is principally engaged in the exploration, development and acquisition of petroleum and natural gas located in Canada's Western Sedimentary Basin. Arcan has 37,826,560 common shares, 598,631 Warrants, 1,500,000 performance warrants, and 3,440,000 stock options outstanding.

BOE Presentation - Production and reserve information is commonly reported in units of barrel of oil equivalent ("boe"). For purposes of computing such units, natural gas is converted to equivalent barrels of oil using a conversion factor of six thousand cubic feet to one barrel of oil. BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of six thousand cubic feet of natural gas to one barrel of oil (i.e., 6 Mcf: 1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Readers should be aware that historical results are not necessarily indicative of future performance.

Special Note Regarding Non-GAAP Measures - This press release contains financial terms that are not considered measures under Canadian generally accepted accounting principles ("GAAP"), such as "funds from (used in) operations". This measures is commonly utilized in the oil and gas industry and is considered informative for management and shareholders. Specifically, "funds from (used in) operations" represents net loss for the period adjusted for non-cash items in the statement of operations. This term should not be considered an alternative to, or more meaningful than cash flow from operating activities as determined under GAAP as an indicator of the Corporation's performance. Management considers this term to be important as it helps evaluate performance and demonstrates the Corporation's ability to generate sufficient cash to fund future growth opportunities.

Advisory Regarding Forward-Looking Statements

Certain information with respect to the Corporation contained herein, including its assessment of future plans and operations contain forward-looking statements. In some cases, forward-looking statements and information can be identified by terminology such as "may", "will", "should", "expects", "projects", "plans", "proposed", "anticipates", "targets", "believes", "estimates", "continue", " designed", "objective", "potential" and similar expressions. In particular, this document contains forward-looking statements and information with respect to: estimated volumes and timing of future production; business plans for drilling, exploration and development; estimated dates for seismic and other programs; and other expectations, beliefs, plans, goals, objectives, assumptions, information and statements about possible future events, conditions, results of operations and performance. These forward-looking statements are based on assumptions and are subject to numerous risks and uncertainties, certain of which are beyond the Corporation's control, including: the impact of general economic conditions, industry conditions, volatility of commodity prices, currency exchange rate fluctuations, imprecision of reserve estimates, uncertainty regarding drilling results, environmental risks, competition from other explorers, stock market volatility and ability to access sufficient capital. As a result, the Corporation's actual results, performance or achievement 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. In addition, the reader is cautioned that historical results are not necessarily indicative of future performance.

SOURCE: Arcan Resources Ltd.

Arcan Resources Ltd.
Ed Gilmet
Chief Executive Officer and President
(403) 262-0321
Email: [email protected]
Arcan Resources Ltd.
Douglas Penner
Chief Financial Officer and Vice President, Finance
(403) 262-0321
(403) 262-4636 (FAX)
Email: [email protected]
Arcan Resources Ltd.
Suite 3200, 450 - 1st Street S.W.
Calgary, AB T2P 5H1