Arena Resources Announces Second Quarter and Six Month 2004 Financial and Operating Results
112% Increase In Revenue For The Three Months to $1.8 Million
82% Increase In Revenue For The Six Months to $3.0 Million

Tulsa, Oklahoma — August 16, 2004 — Arena Resources, Inc. (AMEX: ARD.U, ARD) ("Arena") Tulsa, announced today financial results for the second quarter and six months ended June 30, 2004. Arena had net income of $548,548, or $0.08 per share, on oil and gas revenues of $1,792,414 for the second quarter, compared to net income of $192,552, or $0.03 per share, on oil and gas revenues of $841,619 for the quarter ended June 30, 2003. The Company reported net income of $858,190, or $0.12 per share, on oil and gas revenues of $2,992,814 for the six month period ended June 30, 2004 compared to net income of $382,602, or $0.06 per share, on oil and gas revenues of $1,648,640 for the six month period ended June 30, 2003.

The revenue increase was partly due to increases in production of 65% and 57% for the three and six months periods, respectively. This included two months of production from the East Hobbs Unit in Lea County, New Mexico, which was acquired May 7, 2004. The revenue increase was also attributable in part to increased oil and gas prices. The average commodity prices received by Arena were $36.02 per barrel of oil and $3.76 per MCF (thousand cubic feet) of natural gas for the quarter ended June 30, 2004, compared to $27.71 per barrel of oil and $3.48 per MCF of natural gas for the quarter ended June 30, 2003. The average prices received for the six months ended June 30, 2004 were $34.92 per barrel of oil and $4.22 per MCF of natural gas, compared to $29.67 per barrel of oil and $3.98 per MCF of natural gas for the six month period ended June 30, 2003.

Net cash flow from operations for the six months ended June 30, 2004 was $1,477,134, compared to net cash flow of $686,310 for the same period in 2003.

As of June 30, 2004 the Company had net working capital of $329,378 compared to $1,669,805 as of June 30, 2003. The decrease is directly attributable to the acquisition cost of the East Hobbs Unit and costs incurred in connection with ArenaÕs recently completed secondary offering.

On August 13, 2004, Arena Resources, Inc. completed a secondary public offering of 1,450,000 units at $6.10 per unit, resulting in net proceeds before offering expenses of $8,137,400. Each unit consists of one share of common stock and one warrant to acquire one share of common stock. Each warrant may be exercised at an exercise price of $7.32, and expires August 9, 2008.

Arena's Chief Executive Officer, Mr. Tim Rochford, stated, "We are extremely proud of the results for the second quarter, as well as the first six months. With the acquisition of the East Hobbs Unit completed, our net production is currently over 800 BOE per day. The Company is in excellent position with the proceeds of our offering and cash flow from existing production to start the development work on a number of our properties. We will also continue to seek out and acquire prospects which meet our criteria of positive cash flow and opportunity for further development."

Second Quarter Activity
The second quarter saw the acquisition of the East Hobbs San Andres Unit in New Mexico. The lease consists of 920 acres with existing oil and gas production from 19 wells of approximately 225 BOE (Barrels of Oil Equivalent) net production per day to Arena. In June, 2004, the Company identified seven existing producing wells as "workover" candidates. The Company believes these wells all have multiple pay zones which have not been accessed. The company re-entered two of the wells in June and has added 100 BOE to the average daily production as a result of its efforts on these wells.

Current Planned Activity
East Hobbs Unit, Lea County, New Mexico – The Company plans to re-enter up to five additional "workover" candidates. Also, in September, the Company will drill the first two wells of a planned twelve well development program on this lease.

Auntie Em Unit, Haskell County, Kansas – The Company has received approval to build and complete a seven mile gas transmission line which will allow production from two existing gas wells to be connected to the pipeline. The Company plans on drilling at least one additional gas well on this lease by year-end.

Dodson Unit, Montague County, Texas – The Company plans on drilling the first well in its development program for this 570 acre lease acquired in June 2002. The lease has been unitized for future secondary recovery by year-end.

About Arena Resources, Inc.
Arena Resources, Inc. is an oil and gas exploration, development and production company with current operations in Texas, Oklahoma, Kansas and New Mexico.

This release contains forward-looking statements within the meaning of the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995 that involve a wide variety of risks and uncertainties, including, without limitations, statements with respect to the Company's strategy and prospects. Readers and investors are cautioned that the Company's actual results may differ materially from those described in the forward-looking statements due to a number of factors, including, but not limited to, the Company's ability to acquire productive oil and/or gas properties or to successfully drill and complete oil and/or gas wells on such properties, general economic conditions both domestically and abroad, and the conduct of business by the Company, and other factors that may be more fully described in additional documents set forth by the Company.

For further information contact:
K M Financial, Inc.
Bill Parsons
480-947-1589
k-m-financial@msn.com

Jim Drewitz, Investor Relations
Jdrewitz@comcast.net
972-355-6070