TIDMAXL
RNS Number : 9346L
Arrow Exploration Corp.
11 September 2023
NOT FOR RELEASE, DISTRIBUTION, PUBLICATION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO OR FROM THE UNITED
STATES, AUSTRALIA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER
JURISDICTION WHERE TO DO SO MIGHT CONSTITUTE A VIOLATION OF THE
RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION.
Arrow Announces MAIDEN CARRIZALES NORTE reserves
Corporate ECONOMIC 1P, 2P and 3P Reserves doubled.
CaRRIZALES NORTE Before Tax NPV-10 values $143.5 MMusd AND 3.92
MMBBLS 2P RESERVES,
CALGARY, September 11, 2023 - Arrow Exploration Corp. (AIM: AXL;
TSXV: AXL), the high-growth operator with a portfolio of assets
across key Colombian hydrocarbon basins, is pleased to announce the
results of its maiden Carrizales Norte ("CN") reserves evaluation
by Boury Global Energy Consultants Ltd. ("BouryGEC") as at August
31, 2023.
All reserves volume figures stated below are solely at the
discovery on the CN field on the Tapir Block in the Llanos Basin of
Colombia where Arrow holds a 50% beneficial interest. The Company's
other assets in the Tapir Block, Rio Cravo Este (RCE) and its other
license interests, Columbia and Canada, have not formed part of
this evaluation.
All reserves volume figures stated below are on a Working
Interest Gross Reserve basis. Currency amounts are in United States
dollars, unless otherwise indicated.
Highlights
- CN Proved ("1P") reserves:
o 1.82 million barrels of oil ("MMbbls "),
o Net present value before tax, discounted at 10% ("NPV-10") is
$71.2 million for 1P reserves.
- CN Proved plus Probable ("2P") reserves:
o 3.92 MMbbls ,
o NPV-10 is $143.5 million for 2P reserves.
- CN Proved plus Probable plus Possible ("3P") reserves:
o 6.62 MMbbls ,
o NPV-10 is $244.1 million for 3P reserves.
- Before tax NPV-10 per share of US$0.14/share, US$0.39/share,
and US$0.63/share for 1P, 2P, and 3P reserves categories,
respectively;
- BouryGEC post-tax NPVs impacted by changes in Colombian tax
regime in the year and exclude the effect of corporate tax shelters
(further detail below).
CEO Commentary
Marshall Abbott, CEO of Arrow, commented: "The Carrizales Norte
field is a material discovery for Arrow as the reserves report
confirms. The Carrizales Norte reserves have doubled the 1P, 2P and
3P total reserves and value of Arrow. We are pleased with the
results of the BouryGEC reserves evaluation, which reinforces the
significant value of our Carrizales Norte asset at Tapir."
"The 3D program on the west of the Tapir block completed this
year has also helped further develop prospects that we feel could
show results similar to the Carrizales Norte and Rio Cravo Este
fields. The Company plans to explore these prospects in the coming
months and years."
Carrizales Norte Maiden Reserves Summary as at August 31,
2023
Management has presented below a summary of Arrow's CN reserves
as at August 31, 2023, on a Working Interest Gross Reserves basis
(see glossary of terms), which have been taken from and reconcile
directly to the reserves report prepared by BouryGEC, an
independent qualified reserves evaluator. The figures in the
following tables have been prepared in accordance with the
standards contained in the most recent publication of the Canadian
Oil and Gas Evaluation Handbook (the "COGEH") and the reserve
definitions contained in National Instrument 51-101 - Standards of
Disclosure for Oil and Gas Activities ("NI 51-101"). In addition to
the summary information disclosed in this announcement, more
detailed information will be included in Arrow's CN reserves
evaluation for the date ended August 31, 2023 to be filed on SEDAR
(www.sedar.com) and posted on Arrow's website (
www.arrowexploration.ca ).
After tax values have been calculated without taking into
account the tax shelter created by capital spending on projects
that do not have reserve values associated with them, such as the
Tapir 3D seismic project and annual G&A. Spending on these
projects will provide tax shelter and result in a reduction of tax
in the future.
Brent Crude Oil Price Forecasts in BouryGEC Reserves
Evaluation
Year-End Forecast: 2023 2024 2025 2026 2027 2028 2029
Brent (US$/bbl) - June
30, 2023 $76.50 $77.50 $78.00 $79.00 $81.00 $84.00 $85.58
------- ------- ------- ------- ------- ------- -------
Carrizales Norte August 31, 2023 Working Interest Gross Reserves
- Breakdown by Category (Mboe)
2023
Proved developed
producing 278
------
- Carrizales Norte
(core) 278
------
Proved developed
non-producing 228
------
- Carrizales Norte
(core) 228
------
Proved undeveloped 1,314
------
- Carrizales Norte
(core) 1,314
------
Total Proved 1,820
------
Probable 2,099
------
- Carrizales Norte
(core) 2,099
------
Total Proved plus
Probable 3,919
------
Possible 2,704
------
- Carrizales Norte
(core) 2,704
------
Total Proved plus
Probable & Possible 6,622
------
Possible reserves are those additional reserves that are less
certain to be recovered than probable reserves. There is a 10%
probability that the quantities actually recovered will equal or
exceed the sum of proved plus probable plus possible reserves.
(1) "Core" assets include Arrow's share of reserves in the
Carrizales Norte field on the Tapir block. Arrow's 50% interest in
the Tapir Block is contingent on the assignment by Ecopetrol SA of
such interest to Arrow.
Carrizales Norte Net Present Value at 10% - Before Tax ($
Thousands) as at August 31, 2923
Category 2023
Proved
--------
Developed Producing 7,516
--------
Non-Producing 10,490
--------
Undeveloped 53,176
--------
Total Proved 71,182
--------
Probable 72,310
--------
Total Proved plus Probable 143,492
--------
Possible 100,633
--------
Total Proved plus Probable &
Possible 244,125
--------
Possible reserves are those additional reserves that are less
certain to be recovered than probable reserves. There is a 10%
probability that the quantities actually recovered will equal or
exceed the sum of proved plus probable plus possible reserves.
Carrizales Norte Net Present Value at 10% - After Tax ($
Thousands) as at August 31, 2023
Category 2023
Proved
--------
Developed Producing 3,232
--------
Non-Producing 5,221
--------
Undeveloped 25,616
--------
Total Proved 34,069
--------
Probable 32,544
--------
Total Proved plus Probable 66,613
--------
Possible 47,107
--------
Total Proved plus Probable &
Possible 113,721
--------
Possible reserves are those additional reserves that are less
certain to be recovered than probable reserves. There is a 10%
probability that the quantities actually recovered will equal or
exceed the sum of proved plus probable plus possible reserves.
Carrizales Norte Forecast Revenues and Costs - Undiscounted ($
millions)
Category Revenue (3) Royalties Operating Development Abandonment BT Future Income AT Future
Cost (2) Costs & Net Taxes Net
Reclamation Revenue Revenue
(1) (1)
Total
Proved 122.7 14.1 7.9 17.4 1.0 82.3 42.2 40.1
------------ ---------- ----------- ------------ ------------ ----------- ----------- -----------
Total
Proved
plus
Probable 271.6 32.0 23.4 31.6 1.9 182.7 96.2 86.5
------------ ---------- ----------- ------------ ------------ ----------- ----------- -----------
Total
Proved
plus
Probable &
Possible 470.3 56.4 41.2 36.4 2.7 333.6 176.2 157.4
------------ ---------- ----------- ------------ ------------ ----------- ----------- -----------
Possible reserves are those additional reserves that are less
certain to be recovered than probable reserves. There is a 10%
probability that the quantities actually recovered will equal or
exceed the sum of proved plus probable plus possible reserves.
(1) BT = Before Taxes and AT = After Taxes
(2) Operating Cost less processing and other income
(3) Revenue includes Petrolco Income
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 of experience
in the oil and gas industry.
The recovery and reserve estimates provided in this news release
are estimates only, and there is no guarantee that the estimated
reserves will be recovered. Actual reserves may eventually prove to
be greater than, or less than, the estimates provided herein. In
certain of the tables set forth above, the columns may not add due
to rounding.
Cautionary Statement
The estimates of reserves and future net revenue for individual
properties may not reflect the same confidence level as estimates
of reserves and future net revenue for all properties, due to the
effects of aggregation.
This press release contains various references to the
abbreviation "BOE" which means barrels of oil equivalent. Where
amounts are expressed on a BOE basis, natural gas volumes have been
converted to oil equivalence at six thousand cubic feet (Mcf) per
barrel (bbl). The term BOE may be misleading, particularly if used
in isolation. A BOE conversion ratio of six thousand cubic feet per
barrel is 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").
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
James Asensio
Gordon Hamilton +44 (0)20 7523 8000
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
under-exploited, 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".
Reserves Categories
Reserves are estimated remaining quantities of oil and natural
gas and related substances anticipated to be recoverable from known
accumulations, from a given date forward, based on analysis of
drilling, geological, geophysical and engineering data; the use of
established technology; and specified economic conditions which are
generally accepted as being reasonable and shall be disclosed.
"Proved Developed Producing Reserves" are those reserves that
are expected to be recovered from completion intervals open at the
time of the estimate. These reserves may be currently producing or,
if shut-in, they must have previously been on production, and the
date of resumption of production must be known with reasonable
certainty.
"Proved Developed Non-Producing Reserves" are those reserves
that either have not been on production or have previously been on
production but are shut-in and the date of resumption of production
is unknown.
"Proved Undeveloped Reserves" are those reserves expected to be
recovered from known accumulations where a significant expenditure
(e.g., when compared to the cost of drilling a well) is required to
render them capable of production. They must fully meet the
requirements of the reserves category (proved, probable, possible)
to which they are assigned.
"Proved" reserves are those reserves that can be estimated with
a high degree of certainty to be recoverable.
"Probable" reserves are those additional reserves that are less
certain to be recovered than Proved reserves but more certain to be
recovered than Possible reserves.
"Possible" reserves are those additional reserves that are less
likely to be recoverable than Probable reserves.
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
Bbls: Barrels
PDP: Proved Developed Producing
1P: Proved Reserves
2P: Proved plus Probable Reserves
3P: Proved plus Probable plus Possible Reserves
Working Interest Gross Reserves: The reserves attributable to
the Company's license working interest pre-taxes and royalties. The
Company has a 50% working Interest in the Tapir Licence which is
subject to formal assignment by Ecopetrol.
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END
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