REG - Arrow Exploration - Operations Update and 2024 Guidance

Arrow ExplorationAnnouncement

04/01/2024 07:00

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RNS Number : 5892Y  Arrow Exploration Corp.  04 January 2024

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ARROW PROVIDES OPERATIONS UPDATE AND 2024 GUIDANCE

RCE-7 and RCE-8 C7 on production

CALGARY, January 4, 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 operations and provide guidance moving into 2024.

 

CORPORATE & 2024 BUDGET

The Company exited 2023 with a production rate exceeding 3,200 boe/d net.

Arrow's Board of Directors has approved the 2024 work program, which includes
15 wells and a $45 million net capital budget. The entire capex budget will be
financed by current cash reserves and operating cash flow. The 2024 budget
focuses on the Tapir block and the development of the Carrizales Norte (CN)
field.  The Company expects to employ two rigs for the entire year on the
Tapir block with a third rig being utilized as required.  The capex emphasis
is focused on development and infill drilling combined with targeting low-risk
exploration prospects.

The Company plans to drill three horizontal wells at CN penetrating the 110
feet of oil column proven up by the initial three wells drilled in the Ubaque
reservoir in 2023. The Company also plans on drilling four Carbonera C7
vertical wells at CN on a broad structural high. Both zones have proven to be
prolific producers in the initial drilling phase. Another vertical well at CN
will focus on production out of the Ubaque which will give the Company
additional information on the direction of the planned horizontal wells.  In
addition to the development of CN, Arrow will be focusing on low-risk
exploration, with wells spread across the Mateguafa prospect, a step out from
the initial Mateguafa discovery, (that has produced 600,000 barrels to date),
the Baquiano prospect,  which is believed to be technically identical to the
Carrizales Norte discovery, and the Carrizales Noroeste prospect that will
test the  hydrocarbon-charged structure west of the main fault at CN.  In
isolation, each prospect has potential, on its own, to add materially to
production, reserves and cash flow.

The Tapir Block in the Llanos Basin of Colombia, where Arrow holds a 50 per
cent beneficial interest, currently has 11 producing wells including the
latest wells to be drilled, Rio Cravo Este 7 (RCE-7) and Rio Cravo Este 8
(RCE-8).  Both RCE-7 and RCE-8 were completed in the C7 and brought on
production during the last quarter of 2023. RCE-7 and RCE-8 are exceeding
expectations with combined production of over 1,700 BOPD gross (850 BOPD
net).  The RCE complex has produced 1.7 million barrels in the last 12 months
and additional development locations are planned.

Oso Pardo and Capella

The Oso Pardo-3 and Oso Pardo-4 wells on the Oso Pardo field in the Middle
Magdalena Valley Basin of Colombia, where Arrow has a 100 per cent working
interest, were drilled and tested successfully.  During the testing phase for
both wells, Management determined that there was reservoir damage due to high
mud weight used in drilling. Original OP wells were ultimately stimulated with
positive results.     Arrow expects the reservoir stimulations to take
place early in the first quarter of 2024 and for the wells to be put on
production. Production from Oso Pardo 1 was offline at year-end due to a hole
in the production pipe.  Management expects to turn the well back on in early
2024 once the workover is complete.

Capella remains offline, while discussions continue between the operator and
local communities.

 

 

Marshall Abbott, CEO of Arrow commented:

"Arrow is proud of the work completed and results for 2023, our average
production rates more than doubled over the year and the Company proved it was
able to execute an aggressive capital work program.  The Company believes it
is capable of similar production growth in 2024.  Arrow discovered a new,
multi-zone, core area and enjoyed a positive step change in reserves.  Arrow
was also able to complete a 100 square km 3D seismic program and develop
numerous new prospects.

"In 2024 the Company plans to continue the high-paced growth profile with
development drilling in the Ubaque and Carbonera formations.  The 2023
results demonstrate that the Carbonera remains a solid high-volume producer
while the Ubaque formation has proven production that extends beyond the CN
complex. Multiple development locations are anticipated based on current
results, including horizontal drilling in the Ubaque reservoir in the CN
field. Horizontal wells typically produce at materially higher rates with
marginal cost increases compared to a vertical well, increasing recovery and
the economics of thick pay oil fields. As well, additional development
drilling is contemplated from the RCE pad.

"Arrow's fully funded, low risk drilling program for 2024 continues to build
momentum across our extensive portfolio. Arrow is poised to achieve
significantly higher production and commensurate cash flow through the 2024
calendar year.

"The Board of Directors appreciates the successful work of our dedicated
employees in Calgary and Bogota and the support from our patient shareholder
base."

 

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
 Kirsty Duff

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

BOE/D:  barrels of oil equivalent per day

BOPD: barrels of oil 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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