REG - Arrow Exploration - CN-4 and CN-5 Results

Arrow ExplorationAnnouncement

20/02/2024 07:00

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RNS Number : 6717D  Arrow Exploration Corp.  20 February 2024

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ARROW ANNOUNCES CN-4 AND CN-5 RESULTS

Ubaque formation at Carrizales Norte continues to exceed expectations

CALGARY, February 20, 2024 - Arrow Exploration Corp. (AIM: AXL; TSXV: AXL)
("Arrow" or the "Company"), the high-growth operator with a portfolio of
assets across key Colombian hydrocarbon basins, is pleased to provide an
update on activity on the Tapir Block in the Llanos Basin of Colombia in which
the Company has a 50% beneficial working interest.

CN-4 Well

The CN-4 well was spud on January 17, 2024, and reached target depth on
January 27, 2024.  The well was drilled to a total measured depth of 9,552
feet (8,613 feet true vertical depth) and targeted the Ubaque formation.

Arrow completed the well in the Ubaque formation, which has 29 feet of true
vertical depth net oil pay. The pay zone is a clean sandstone exhibiting
consistent 26% porosity, 5 Darcy permeability and high resistivities from top
of sand to base of sand. An electric submersible pump (ESP) was inserted in
the well after perforating.

The well confirms Arrow's understanding of the large Ubaque resource base and
commensurate horizontal drilling opportunities it provides.

Specific data for the initial production from the Ubaque formation are as
follows:

·    The well initiated production with a flow rate of 780 barrels of
fluid per day.

·    After recovery of the drilling and completion fluids, in a 12 hour
production period the well produced 758 BOPD gross (379 BOPD net) with a 7%
average water cut.

·    Measured oil from the Ubaque formation shows an API gravity of 13°.

To efficiently manage the reservoir, the ESP is currently running at 42 Hz,
minimum optimum pump frequency, and a 128/128 choke size is being used. The
CN-4 well is currently on production, producing from the Ubaque formation at
478 BOPD gross (239 BOPD net).  Management's intention is to produce the well
conservatively, at current rates, to ensure the highest estimated ultimate
recovery (EUR). This approach will provide significant operational
flexibility.

The CN-4 well did not test the C7 or Gacheta formations.   The Ubaque
production and reserves potential are considered the first priority for the
Company.  C7 and Gacheta potential will be unlocked with future wells and
recompletions.

Initial production results are not necessarily indicative of long-term
performance or ultimate recovery.

CN-5 Well

The CN-5 well was spud on February 8, 2024 to test the Carrizales Noroeste
prospect and reached total depth of 9,050 feet true vertical depth on February
14, 2024. Initial interpretation of the logging of this well, drilled to the
west of the known pool boundary, shows 45 feet of Ubaque oil pay to base of
sand. The reservoir demonstrates consistent 25% porosity and 5 Darcy
permeability. CN-5 has confirmed that there is a stratigraphic component to
the trapping mechanism in the Ubaque reservoir as it extends to the west and
is therefore expected to add significantly to the existing Ubaque oil
reserves. The Company expects to complete the well for production over the
next few weeks.

Operations Update

·    The CN-6 well will spud once the CN-5 well is on production and will
target the C7 Carbonara formation in a structurally high location. 3-D seismic
shows considerable running room for C7 development drilling within the
sizeable primary Carrizales Norte structure.

·    Work continues on the construction of the Carrizales Norte Horizontal
Pad ("CN B"), the Matteguafa Attic pad and the Baquiano road and pad.  The
Company expects to bring in a second rig for deployment at the CN B pad and a
third rig for use at the Matteguafa Attic pad.  The Company expects the first
horizontal well at the CN B pad will be spud in Q2.

·    Preliminary interpretation of the recently acquired Tapir 3D seismic
program has further established the presence of an appreciable number of low
risk prospects in this fertile part of the Llanos Basin.  Analysis of the 3D
data is ongoing, with expectations that additional prospects will be
developed. This data has provided considerably more detail over the northern
portion of the Tapir block.

·    The Company continues to have a strong balance sheet, with no debt
and over US$13 million in the bank at February 15, 2024.

·    Capella production remains shut-in, waiting on government and
operator meetings with communities in the area.

·    The stimulation design for OP-3 and OP-4 are being reviewed
internally.  Expectations are that the operations will commence in Q2.

 

Marshall Abbott, CEO of Arrow commented:

"The thick pay zones encountered in the CN-4 and CN-5 wells underpins the step
change in value that has been created. The Company expects material reserves
additions and production from further development of the multi-zone potential
at Carrizales Norte. The defined Ubaque reservoir has set the stage for
conventional horizontal exploitation which we expect to lead to material
production, cash flow and reserves growth. Additional pay zones currently
behind pipe provide further opportunities for production and reserves
increases in the future.

"The CN-4 and CN-5 well results have helped determine the size of the Ubaque
pool at Carrizales Norte and there are strong indications that the reserves
additions will transform Arrow into a much larger company. Multiple
development locations are anticipated based on current results.

"With both the RCE and CN fields, management plans to control pump speed and
choke wells back to efficiently manage the reservoir and discourage premature
water production. Arrow believes this is in the best long-term interest of the
reservoir and will maximize recovery from both fields.

"There is strong momentum at Arrow, as we continue with our fully funded, low
risk drilling program across our extensive portfolio.  The CN-4 and CN-5
wells have successfully increased production and are expected to add
materially to reserves. Alongside this, we are encouraged by the number of
prospects the Tapir 3D seismic has outlined and the drilling inventory it has
provided.

"I would like to recognize the professionalism and work ethic that our entire
team has dedicated to our continued success."

 

 

For further Information, contact:

 Arrow Exploration
 Marshall Abbott, CEO                                                                   +1 403 651 5995
 Joe McFarlane, CFO                                                                     +1 403 818 1033

 Brookline Public Relations, Inc.

 Shauna MacDonald                                                                       +1 403 538 5645

 Canaccord Genuity (Nominated Advisor and Joint Broker)
 Henry Fitzgerald-O'Connor                                                              +44 (0)20 7523 8000

 James Asensio

 George Grainger

 Auctus Advisors (Joint Broker)
 Jonathan Wright                                                                        +44 (0)7711 627449
 Rupert Holdsworth Hunt

 Camarco (Financial PR)
 Andrew Turner                                                                          +44 (0)20 3781 8331
 Rebecca Waterworth

About Arrow Exploration Corp.

Arrow Exploration Corp. (operating in Colombia via a branch of its 100% owned
subsidiary Carrao Energy S.A.) is a publicly traded company with a portfolio
of premiere Colombian oil assets that are underexploited, under-explored and
offer high potential growth. The Company's business plan is to expand oil
production from some of Colombia's most active basins, including the Llanos,
Middle Magdalena Valley (MMV) and Putumayo Basin. The asset base is
predominantly operated with high working interests, and the Brent-linked light
oil pricing exposure combines with low royalties to yield attractive potential
operating margins. Arrow's 50% interest in the Tapir Block is contingent on
the assignment by Ecopetrol SA of such interest to Arrow. Arrow's seasoned
team is led by a hands-on executive team supported by an experienced board.
Arrow is listed on the AIM market of the London Stock Exchange and on TSX
Venture Exchange under the symbol "AXL".

Forward-looking Statements

This news release contains certain statements or disclosures relating to Arrow
that are based on the expectations of its management as well as assumptions
made by and information currently available to Arrow which may constitute
forward-looking statements or information ("forward-looking statements") under
applicable securities laws. All such statements and disclosures, other than
those of historical fact, which address activities, events, outcomes, results
or developments that Arrow anticipates or expects may, could or will occur in
the future (in whole or in part) should be considered forward-looking
statements. In some cases, forward-looking statements can be identified by the
use of the words "continue", "expect", "opportunity", "plan", "potential" and
"will" and similar expressions. The forward-looking statements contained in
this news release reflect several material factors and expectations and
assumptions of Arrow, including without limitation, Arrow's evaluation of the
impacts of COVID-19, the potential of Arrow's Colombian and/or Canadian assets
(or any of them individually), the prices of oil and/or natural gas, and
Arrow's business plan to expand oil and gas production and achieve attractive
potential operating margins. Arrow believes the expectations and assumptions
reflected in the forward-looking statements are reasonable at this time, but
no assurance can be given that these factors, expectations, and assumptions
will prove to be correct.

The forward-looking statements included in this news release are not
guarantees of future performance and should not be unduly relied upon. Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors that may cause actual results or events to differ materially
from those anticipated in such forward-looking statements. The forward-looking
statements contained in this news release are made as of the date hereof and
the Company undertakes no obligations to update publicly or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise, unless so required by applicable securities laws.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.

Glossary

API:        A specific gravity
(https://glossary.oilfield.slb.com/en/terms/s/specific_gravity)  scale
developed by the American Petroleum Institute (API
(https://glossary.oilfield.slb.com/en/terms/a/api) ) for measuring the
relative density of various petroleum liquids, expressed in degrees.

Bopd:    barrels of oil per day

boe/d:  barrels of oil equivalent per day

Qualified Person's Statement

The technical information contained in this announcement has been reviewed and
approved by Grant Carnie, senior non-executive director of Arrow Exploration
Corp. Mr. Carnie a past member of the Canadian Society of Petroleum Engineers,
holds a B.Sc. in Geology from the University of Alberta and has over 40 years'
experience in the oil and gas industry.

 

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