REG - Arrow Exploration - Second Ubaque Horizontal Well Results

Arrow ExplorationAnnouncement

31/07/2024 07:00

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RNS Number : 4796Y  Arrow Exploration Corp.  31 July 2024

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ARROW ANNOUNCES SECOND UBAQUE HORIZONTAL WELL RESULTS

CNB HZ-3 on production

CALGARY, July 31, 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 operational activity, particularly at the multi horizon, Carrizales
Norte ("CN") field on the Tapir Block in the Llanos Basin of Colombia where
Arrow holds a 50 percent beneficial interest.

CNB HZ-3

The second of the Ubaque horizontal wells planned for 2024 is now on
production.  The second horizontal well on the Carrizales Norte "B" pad (CNB
HZ-3) is exceeding expectations and is being restricted to a current flow rate
of 3,038 BOPD gross (1,519 BOPD net to Arrow) with less than 6.5% water cut
while still recovering load fluid.  Please note initial production flows are
not necessarily indicative of long-term performance or ultimate recovery and a
stabilized production rate will be determined in the first few weeks of
operations, in keeping with conservative reservoir management. Further updates
will be provided in due course.

CNB HZ-3 was spud on July 4, 2024, and reached a target depth of 8,457 feet
(true vertical depth) on July 18, 2024.  The well was drilled to a total
measured depth of 12,320 feet with a horizontal section of approximately 3,050
feet. CNB HZ-3 came on production on July 26, 2024, with the use of an
electric submersible pump (ESP) and, based on initial results, has displayed
the same reservoir characteristics as CNB HZ-1.

CNB HZ-1

The CNB HZ-1 is continuing to perform above expectations and is being
restricted to a current flow rate of 2,220 BOPD gross (1,110 BOPD net to
Arrow) with approximately 34% water cut.

CNB HZ-1 average production for the first 30 days of production (IP30) was
2,650 BOPD gross (1,325 net).

Drilling Time and Costs

From spud to rig release the CNB HZ-1 took 30 days and cost approximately $4.9
million gross ($2.45 million net to Arrow).  The CNB HZ-1 well paid out in
under 30 days.  Drilling operations at the CNB HZ-3 well took 21 days from
spud to on production and cost approximately $4.0 million gross ($2.0 million
net to Arrow).  The improvement represents the learnings taken from CNB HZ-1
as the operations team continues to focus on  improving capital and operating
costs and creating further shareholder value.

 

Upcoming Drilling

The rig has been moved to the fourth cellar on the Carrizales Norte B Pad
where the Company has spud the third horizontal well (CNB HZ-4).
 Thereafter, the Company expects to drill the fourth horizontal well on the B
pad, followed by the Baquiano-1 exploration well, which is on trend with the
Carrizales Norte field.  Following the drilling program at Baquiano, Arrow
plans to return to the CNB pad for two additional horizontal wells.

 

Water Disposal Update

The conversion of the CN-4 well to a water disposal well is complete and
injection has commenced. The CNB-2 water disposal well has been completed and
is awaiting stimulation work and regulatory approval prior to starting
injection.

 

Corporate Update

Current net corporate production is approximately 4,560 BOE/D, inclusive of
CNB HZ-1 and CNB HZ-3.

 

Arrow's cash position was approximately $11 million on July 1, 2024.
Although Arrow has an aggressive capital program, the Company has maintained a
healthy balance sheet with no debt.

 

Marshall Abbott, CEO of Arrow commented:

"The continued success of the horizontal well program at the CNB pad, has led
the Company to plan two additional horizontal wells which Arrow intends to
drill before the end of 2024, depending on technical aspects and regulatory
approvals.  This will result in a total of six horizontal wells at Carrizales
Norte in 2024 with additional horizontal wells being planned in 2025 from a
third pad.  The horizontal program continues to exceed expectations and to
add production and reserves from the hydrocarbon-dense Ubaque formation. The
Arrow team strives to reduce the time and costs needed to drill horizontal and
vertical wells.  Internally generated development drilling and completion
strategies will be used to exploit further prospects on the Company's land
holdings."

"The production rates from the CNB HZ-1 well are exceeding the simulation
results and the CNB HZ-3 well was drilled, completed and brought on production
under budget. The Company is excited about the initial results of the well and
the potential to further grow reserves and production."

"Production infrastructure including water disposal wells, dispersion fields
and roads continue to be developed to increase production and prepare for the
2025 capital program."

 

 

For further Information, contact:

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

 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 premier 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. By way of a private commercial contract with the recognized
interest holder before Ecopetrol S.A., Arrow is entitled to receive 50% of the
production from the Tapir block. The formal assignment to the Company is
subject to Ecopetrol's consent.  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 was a member of the Canadian Society of Petroleum Engineers,
holds a B.Sc. in Geology from the University of Alberta and has over 35 years'
experience in the oil and gas industry.

This Announcement contains inside information for the purposes of the UK
version of the market abuse regulation (EU No. 596/2014) as it forms part of
United Kingdom domestic law by virtue of the European Union (Withdrawal) Act
2018 ("UK MAR").

 

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