REG - Arrow Exploration - Fifth Ubaque Horizontal Well Results

Arrow ExplorationAnnouncement

11/11/2024 07:00

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RNS Number : 6163L  Arrow Exploration Corp.  11 November 2024

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ARROW ANNOUNCES FIFTH UBAQUE HORIZONTAL WELL RESULTS

CNB HZ-6 on production

 

CALGARY, November 11, 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.

 

Highlights

·    CNB HZ-6 now on production having cleaned up at an initial rate of
2,250 BOPD gross (1,125 BOPD net to Arrow)

·    Post fitting of electric submersible pump ("ESP") CNB HZ-6 currently
flowing at a rate exceeding 1,900 BOPD gross (960 BOPD net to Arrow) with a
31% water cut

·    Water disposal facility at the CNB pad began operating on November 2,
2024.  This completes the current water disposal infrastructure allowing
Arrow to increase pump rates and production

·    CNB HZ-7 spud by Petroworks rig on October 22, 2024.  Once complete,
the rig will move to drill the Alberta Llanos prospect (formerly known as
Baquiano-1)

·    Current net corporate production is over 5,305 BOE/D, inclusive of
CNB HZ-6, with cash position exceeding $18 million on November 1, 2024

 

CNB HZ-6

The fifth horizontal well on the Carrizales Norte "B" pad (CNB HZ-6) is now on
production.  The well was brought on production on October 19, 2024, and
cleaned up to an initial production rate of 2,250 BOPD gross (1,125 BOPD net).
The well has had an ESP fitted and is currently flowing in excess of 1,900
BOPD gross (960 BOPD net to Arrow) with a 31% water cut.  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.

 

CNB HZ-6 was spud on September 27, 2024, and reached a target depth of 8,450
feet (true vertical depth) on October 12, 2024.  The well was drilled to a
total measured depth of 14,065 feet with a horizontal section of approximately
4,550 feet.

 

The CNB HZ-6 is the third Arrow well to use Autonomous Inflow Control Devices
(AICDs) which are designed to limit the water cut in horizontal wells.
Sustained flow rates from wells with AICDs strongly indicate that suppressed
water cuts and shallower declines will result in superior ultimate oil
recoveries from the Ubaque reservoir.

 

Disposal Facilities and Production Optimization

Arrow has completed the water disposal facility at the CNB pad.  The facility
began operating on November 2, 2024.  Combined with the water disposal
facilities at the CN and RCE pads, Arrow believes it has the ability to safely
dispose of all water to be produced from those pads in the foreseeable
future.

 

The new water infrastructure will not only make operations more efficient and
decrease operating costs, it will also allow for future production growth.
 Trucking needs will also reduce, providing benefits for the local
communities and the environment.

 

With the water disposal facilities now in place and operational, Arrows plans
to increase pump speed on existing wells.  Arrow estimates that it will be
capable to initially add 600 - 800 BOPD from the CN and RCE pads. Arrow's
success in establishing high volume water disposal capabilities enables the
Company to produce its oil wells more aggressively. Water production in the
Llanos Basin and the strength of the water aquifers in the Ubaque and
Carbonera reservoirs are essential to higher-than-average estimated ultimate
recoveries.

 

 

CNB HZ-5, HZ-4, HZ-3 and HZ-1

The first four horizontal wells (CNB HZ-1, HZ-3, HZ-4 and HZ-5) on the CNB pad
continue to perform above third-party modeling expectations with the following
flow rates and water cuts:

 

CNB HZ-5             Gross 1,000 BOPD            Net 500
BOPD                    Water Cut 52%

CNB HZ-4             Gross 1,110 BOPD            Net
555 BOPD                    Water Cut 52%

CNB HZ-3             Gross 1,090 BOPD            Net
545 BOPD                    Water Cut 71%

CNB HZ-1             Gross 1,160 BOPD            Net
580 BOPD                    Water Cut 70%

 

This performance demonstrates how AICDs are suppressing water production to
the benefit of oil production.

 

 

CNB HZ-7 and Upcoming Drilling

The Petroworks rig has been moved to the seventh cellar on the Carrizales
Norte B Pad where the Company spud the sixth horizontal well (CNB HZ-7) on
October 22, 2024.  Once the CNB HZ-7 well is complete, the Company will move
the rig to drill the Alberta Llanos prospect (formerly known as Baquiano-1),
which is on trend with the Carrizales Norte field.  The Company plans to
utilize two drilling rigs in 2025 to develop the Alberta Llanos prospect and
drill development wells at the RCE and CN fields.  Also in 2025, the
Mateguafa Oeste, Mateguafa Attic and Capullo prospects will be drilled.

 

 

Corporate Update

Current net corporate production is over 5,305 BOE/D, inclusive of CNB HZ-6.

 

Arrow's cash position exceeded $18 million on November 1, 2024.  Arrow has
maintained a healthy balance sheet with no debt.

 

 

Marshall Abbott, CEO of Arrow Exploration Corp., commented:

"The initial production results from CNB HZ-6 are very encouraging and follow
the positive trend of horizontal wells at the CNB pad continuing to surpass
expectations. Arrow's focus for the remainder of 2024 will be the completion
of the sixth horizontal well in our program, CNB HZ-7 at Carrizales Norte,
after which we will move to drill a low-risk exploration well at the Alberta
Llanos prospect."

 

"We are also pleased to announce that our water disposal facilities at the CNB
pad began operations in early November which will significantly increase our
ability to safely dispose of water and in turn reduce bottlenecks to future
production and the need for trucking.  The water infrastructure will also
allow us to increase production at the RCE and CN pads.  After completing the
six well drilling program at Carrizales Norte we also expect to increase pump
speed on the horizontal wells."

 

"The planning of our capital program for 2025 is well underway with
development of roads, pads and other civil works in the Tapir block. The 2025
program will consist of drilling of low-risk exploration wells at Mateguafa
Oeste, Capullo, and Mateguafa Attic. In 2025, the Company is also targeting
further horizontal Ubaque and vertical C7 development drilling at Rio Cravo
Este, Carrizales Norte, and Alberta Llanos.  Current plans are to utilize two
drilling rigs in 2025 to accelerate development on the Tapir block."

 

"Our use of superior technologies in drilling, completions and production
ensures maximum profitability at lowest cost. In particular, the advanced
sensory technology used directly behind the drill bit ensures horizontal wells
stay in "zone" for the length of the horizontal lateral. In addition, AICDs
automatically reduce water cut and allow for prolonged and increased oil
production. These innovations allow Arrow to be one of the lowest cost
operators onshore Colombia, resulting in superior payouts which provide a
future foundation for growth."

 

"I would like to thank our talented team and their dedication to Arrow's
success. We look forward to updating stakeholders with the near-term
completion news at CNB HZ-7 and further updates as we continue our extensive
work program in Colombia."

 

 

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)
 Owen Roberts                                                        +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. 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 global pandemics, 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

Bbl/d or bop/d: Barrels per day

$/Bbl: Dollars per barrel

Mcf/d: Thousand cubic feet of gas per day

Mmcf/d: Million cubic feet of gas per day

$/Mcf: Dollars per thousand cubic feet of gas

Mboe: Thousands of barrels of oil equivalent

Boe/d: Barrels of oil equivalent per day

$/Boe: Dollars per barrel of oil equivalent

MMbbls: Million of barrels

 

BOE's may be misleading particularly if used in isolation. A BOE conversion
ratio of 6 Mcf: 1 bblis based on an energy equivalency conversion method
primarily applicable at the burner tip and does not represent a value
equivalency at the wellhead.

 

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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