REG - Arrow Exploration - CN-1 RESULTS AND OPERATIONS UPDATE

Arrow ExplorationAnnouncement

19/06/2023 07:00

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RNS Number : 1177D  Arrow Exploration Corp.  19 June 2023

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ARROW ANNOUNCES CN-1 RESULTS EXCEED EXPECATIONS AND OPERATIONS UPDATE

CN-1 now on production

CALGARY, June 19, 2023 - 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 the operational activity at the Carrizales Norte ("CN") field on the
Tapir Block in the Llanos Basin of Colombia where Arrow holds a 50 percent
beneficial interest.

CN-1

The CN-1 well was spud on May 1, 2023, and reached target depth on May 11,
2023. CN-1 was the first well drilled into the CN field and results from this
well have confirmed the productive potential of the multi-pool field. The well
was drilled to a total measured depth of 9,190 feet (8,511 feet true vertical
depth) and encountered multiple hydrocarbon-bearing intervals.

Arrow has completed the final test on the CN-1 well in the C7 formation which
has approximately 26 feet of net oil pay. The pay zone is a clean sandstone
exhibiting consistent 30% porosity and high resistivities. An electric
submersible pump (ESP) has been inserted in the well after perforating.

Specific data for the production test on the C7 formation are as follows:

·    The production test took place over a 62-hour period.

·    The well was tested at three different flow rates to evaluate
productivity and to plan for water cut management.

o  The first flow period was held for 12 hours and showed an average oil rate
of 662 BOPD gross,

o  The second flow period was for 32 hours and showed an average oil rate of
902 BOPD gross, and,

o  The third flow period was held for 17 hours and showed an average oil rate
of 1,134 BOPD gross.

·    Oil production tested at a peak rate of 1,272 BOPD, and a final
stabilized rate of 1,134 BOPD gross.

In the final 24 hours of the test, CN-1 produced at a rate of 1,103 BOPD gross
(552 BOPD net) of oil at 33.5° API and with a 12% water cut (completion fluid
and formation water). The production test utilized running the ESP at 30 Hz,
the lowest setting on the pump. In addition, a 28/128 choke was inserted to
efficiently manage the reservoir. Water cut decreased throughout completion
testing. The CN-1 well is currently on production, producing from the C7
formation at 1,100 BOPD gross (550 BOPD net). The testing results indicate the
well is capable of higher rates and the ultimate flow rate will be determined
in the first few weeks of production.

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

 

CN-2

The CN-2 well was spud on June 15, 2023. The drilling, testing and completion
of the well is expected to take three weeks. CN-3 will be drilled immediately
upon completion of the CN-2 well.

Operations Update

 

Production

Incorporating CN-1, total Corporate production is between 2,700 and 2,900
boe/d. The Capella field, in which Arrow has a 10% non-operated interest,
remains shut in due to ongoing protests. There is currently no timeline for
when the field will begin production. The lost production is approximately
280-300 BOPD net to Arrow.

Upcoming Drilling

After the CN-3 well is completed, the rig will move to the Rio Cravo Este
("RCE") field to drill two dedicated Gacheta wells, RCE-6 and RCE-7. A third
well, Rio Cravo Sur-2 ("RCS"), is also expected to be drilled at that time
targeting the C7 formation.

 

Following completion of the RCE and RCS wells, the rig will move back to the
CN field where low risk infill drilling is expected to begin before the end of
2023.

West Tapir 3D Seismic Program

The West Tapir 3D seismic acquisition program was completed on April 10, 2023.
Processing has been completed and Management is currently analyzing results
and determining the location of future drilling prospects.

 

In late fall, 2023, Arrow plans a second 3D acquisition program in the
southern part of the Tapir block.  The program is expected to cover a 90 km2
area, where 2D seismic has highlighted a large lead.

 

Cash Balance

On June 1, 2023, the Company's cash balance was US$11.2 million.

 

Marshall Abbott, CEO of Arrow commented:

"Initial production from the CN-1 well has exceeded expectations and is an
exciting event for Arrow . In addition to the thick pay zones encountered on
the Carbonera C7 formation, additional pay zones currently behind pipe provide
further opportunities for production and reserve increases. This includes the
successful production testing of the Ubaque Formation that produced at over
1,200 BOPD gross."

"The Company is looking forward to the CN-2 and CN-3 results which will
further develop the exploration discoveries and help determine the size of the
pools in the field and the potential reserve additions. Arrow plans to
undertake a third-party reserve evaluation of the CN field once the current
drilling program is complete."

"Once the CN-2 and CN-3 wells are complete and on production, Arrow plans to
move the rig to the RCE field to further exploit the multi-zone RCE structure
with two dedicated Gacheta wells and the follow up to the RCS-1 C7 producer.
We lood forward to providing further updates on this low-risk development
drilling program."

"The RCE field is currently producing better than budgeted, and the Company is
controlling pump speed and choking wells back to efficiently manage the
reservoir and discourage premature water production. Additional material
production from RCE is expected with the completion of the upcoming three-well
development program."

 

 

 

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

 Gordon Hamilton

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

 Camarco (Financial PR)
 Georgia Edmonds                                                                        +44 (0)20 3781 8331
 Rebecca Waterworth
 Billy Clegg

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 is 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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